Group Sues SEC for Not Requiring Corporations to Disclose Political Contributions
The Campaign for Accountability, a newly formed public interest group, has filed a lawsuit against the Securities and Exchange Commission (SEC) for failing to enact a regulation requiring corporations to disclose their political contributions that would inform investors how corporations are spending their money.
“Millions of Americans’ lives are negatively impacted by decisions made behind the doors of corporate boardrooms, government offices, and shadowy nonprofit groups,” said Anne Weismann, executive director of the group. “Our group will hold those wrongdoers who act at the expense of the public good accountable for their actions.”
Weismann is the former chief counsel of Citizens for Responsibility and Ethics in Washington.
As part of its 2013 regulatory agenda, the SEC’s Division of Corporation Finance claimed to consider whether the Commission should issue a rule regarding disclosure, but the rule never materialized.
Last year, Silberstein submitted a petition to the SEC requesting the agency require public companies to disclose their political activities, which the SEC ignored.
The lawsuit alleges the SEC has violated the Administrative Procedure Act by failing to act on the rulemaking petition.
In 2013, Silberstein sued Aetna Insurance Company as a shareholder over the company’s failure to accurately reveal its political donations, despite its claim to have a robust disclosure policy in place.
A federal court in New York dismissed the case earlier this year for failure to state a claim under the Securities and Exchange Act.
“Investors should be fully informed as to where high-level executives are directing corporate funds,” Weismann said. “An unprecedented number of Americans have added their voices to calls for the Commission to require corporations to reveal their political spending. While a majority of our citizens want to end the flow of dark money, our government is sitting on its hands. It’s time for a court to force the SEC to act.”
In addition to corporate disclosure policies, other issues the Campaign for Accountability expects to focus on include Wall Street investors who attempt to influence Washington regulators for personal financial gain and predatory lenders who work to undermine the regulatory efforts of government agencies.
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