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The Securities and Exchange Commission is dragging its feet in providing access to records concerning “a control deficiency,” where agency enforcement staff illegally downloaded and gained access to privileged adjudicative documents. The agency has admitted this breach occurred in cases including two adjudicatory matters, SEC v. Michelle Cochran and Jarkesy v. SEC, challenging the constitutionality of SEC’s administrative proceedings.

On July 12, 2022, NCLA submitted a Freedom of Information Act (FOIA) request to SEC, seeking records of these “control deficiencies” that SEC had learned of by Fall 2021 but only publicly acknowledged on April 5, 2022. According to a disclosure statement filed with the Supreme Court and the U.S. Court of Appeals for the Fifth Circuit, SEC enforcement personnel accessed documents stored in the administrative adjudications section of the shared computer system that were created by SEC’s Administrative Law Judges (ALJs) and their staff. Defendants Michelle Cochran and George Jarkesy were only made aware of the Commission’s breach when it was publicly disclosed, even though SEC had known about this serious issue for months. SEC hired outside investigators and conducted an audit and “dozens” of interviews, yet critical details are still shrouded in mystery. Rather than initiate an Inspector General investigation, as the law requires, SEC hired the Berkeley Research Group, a consultancy whose millions of dollars of other SEC business create reason to doubt its objectivity.

Mark Chenoweth
President and Chief Legal Officer
Kara Rollins
Litigation Counsel
Margaret A. Little
Senior Litigation Counsel

Plaintiff's Memorandum in Opposition to Defendant's Motion for Summary Judgement

August 2, 2023 | Read More

Complaint for Declaratory and Injunctive Relief

November 23, 2022 | Read More


SEC Fails to Provide Records After Enforcement Staff Illegally Accessed Privileged Documents

November 28, 2022 | Read More



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