LAWRENCE — The nation’s leading financial regulator is facing a transparency crisis of its own. According to a new study by a University of Kansas law professor, the U.S. Securities and Exchange Commission is becoming increasingly secretive regarding some of its own activities – even as it is increasingly aggressive in demanding disclosures from private actors.
The study by Alexander Platt, associate professor of law at KU, shows how the SEC’s most recent annual report on its whistleblower program is the least transparent in the history of the program.
The whistleblower program encourages people to share information about financial malfeasance with the SEC by offering monetary payments for tips that lead to successful SEC enforcement actions. The program has recently come under fire for its excessive secrecy, which some fear has tilted the playing field in favor of well-connected repeat players. Last summer, one member of the commission cited Platt’s earlier study of the program in a speech calling for increasing transparency surrounding the program.
But rather than expanding transparency, the SEC has done precisely the opposite, according to Platt. As he shows in his new study, which was featured on the Columbia Law School Blue Sky Blog, the SEC’s Fiscal Year 2022 report on the whistleblower program omitted a wide range of significant information that had been included in every prior annual report.
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