This is a new report format for us. It lists those instances wherein the SEC recently cited the "law enforcement exemption" of the Freedom of Information Act (FOIA) as basis to block our access to records we sought on the public companies included in this update. As a matter of law, they are acknowledging some sort of investigative activity. We are publishing it so you have the earliest indication of the existence of a possible SEC investigation.
You should consider the data in this report as only POSSIBLE indicators of SEC investigative activity. They have not yet been confirmed through the administrative appeal process.
Over time, only 70-85% of these initial responses are likely to be confirmed on appeal. This is an estimate based on our long experience in filing FOIA requests with the SEC.
The data we present here is new. However, some of these investigations may have already been disclosed. Further, we may have researched and published on some of these companies in the past. It’s also possible some of the companies are already on our Watch List of companies with Confirmed, Undisclosed SEC Investigations. An update to our Watch List report is published at the beginning of each month.
There are several reasons the SEC might cite the law enforcement exemption as basis to block our access to records. Not all would be of concern to investors today. That is why we use the term “possible” in describing SEC investigations at this point in our research process, until we have confirmed through the appeals process that there is an ongoing investigation.
At Probes Reporter, we routinely file administrative appeals with the Office of the General Counsel of the SEC for every company on our Watch List. After careful review of our appeal, the General Counsel’s office typically informs us of one of the following:
- An on-going enforcement proceeding is confirmed. Only then will we use the term “confirmed” next to the company’s name on our Watch List.
- There was an investigation that is now completed and the file has been remanded for further processing. We may learn more about what took place if the SEC provides documents to us.
- There are no records responsive to our request. This could be because there was an investigation that concluded in the past but the SEC’s records were not current at the time of our request. Alternatively, there may be an investigation involving not the company, but some other person or entity and the company was incidentally named or tangentially listed.
- Rarely, the appeal response will inform us a clerical error was made by the SEC in processing our original request.