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FOIA Facts: Expanding the FOIA

By Scott A. Hodes, Published on August 17, 2008

Recently, Senator Charles Grassley (R.- IA) introduced [Editor's note: Congressional Record: July 16, 2008 (Senate) Page S6873-S6875] a bill [Editor's note: Open and Transparent Smithsonian Act of 2008] that would require the Court of Appeals for the District of Columbia Circuit in the 1990’s. Currently, the Smithsonian does take and answer FOIA requests. However, if the Smithsonian withheld information there is no vehicle for the requester to get a federal court to review the Smithsonian’s answer.

The Smithsonian receives 70 percent of its funding from Congressional appropriations according to Sen. Grassley. Various upper level management of the Smithsonian has been found to have ethical issues over the past few years. I believe that there is no reason the Smithsonian is exempt from the FOIA, and that Sen. Grassley’s bill should immediately be passed and signed into law.

I don’t think Congress should stop with this measure. Another agency, the PCAOB (Public Company Accounting Oversight Board), which oversees, regulates and issues guidance on public accounting firms, is also exempt from the FOIA. The PCAOB makes rules for public accounting that are subject to the SEC approval. These rules are then used to conduct investigations to discipline public accounting firms and persons associated with these firms. The PCAOB also conducts continuing inspection of public accounting firms. In short, the PCAOB operates as a government body, regulating the accounting field.

Nearly four years ago, I called for the PCAOB to be subject to the FOIA. It hasn’t been done, and I believe the time has long passed for that to happen. Some may argue that because the PCAOB is subject in many cases to SEC approval and oversight, those pertinent records may be received via FOIA requests to the SEC. This is unreasonable for a couple of reasons. First, the records of the PCAOB that the SEC may have do not overlap with all PCAOB records. All PCAOB records should be subject to the FOIA, not just a select group of records.

Second, as anyone who has ever dealt with the SEC FOIA Office is aware, the SEC has enormous problems with its ability to process FOIA requests. The SEC has a FOIA backlog — requests for PCAOB information only add to it. Additionally, the SEC, with its independent litigating authority, defends its own FOIA lawsuits – and often does not follow Department of Justice FOIA guidance. Anything that moves FOIA processing out of the SEC’s orbit is a positive for FOIA requesters.

Other agencies that should be made subject to FOIA are Freddie Mac and Fannie Mae. These organizations are government sponsored enterprises and are regulated by the Office of Federal Housing Enterprise Oversight (“OFHEO”). Their respective records that end up at OFHEO become subject to FOIA. However, in the interests of transparency, I believe that all records from these organizations should be made subject to the FOIA.