Last Friday, July 14, Gary Aguirre filed a federal lawsuit against the Securities and Exchange Commission (SEC) under the Freedom of Information Act (FOIA) and the Privacy act seeking three categories of records – all relating to his recent testimony before the Senate Judiciary Committee. The first category seeks records such as transcripts of testimony, internal emails, and correspondence relating to the SEC decision to halt an insider trading investigation Aguirre led. This investigation involved the CEO of one of the nation’s largest hedge funds and the current CEO of one of the nation’s largest investment banks.
Aguirre sought these records in a FOIA request submitted to the SEC last March. The SEC declined to produce the records, relying on Exemption 7A of FOIA. That exemption authorizes the withholding of “records or information compiled for law enforcement purposes, but only to the extent that production of such law enforcement records or information…could reasonably be expected to interfere with enforcement proceedings.” Justification using this exemption is at issue, as a July 3 article in Barron’s Magazine (“Roundtable Rascals”) states that the CEO of the hedge fund claims the SEC halted the investigation.
The lawsuit also seeks SEC records relating to its decision to award Aguirre a two-step merit pay raise on August 21, 2005, only to terminate his employment eleven days later on September 1, 2005. Aguirre has been seeking these records since September 2005.
Finally, the lawsuit seeks information relating to the legal basis for the threats the SEC has directed to Aguirre when he informed the SEC of his intention to provide SEC records to the Office of Special Counsel (OSC) to prove the “misconduct of certain SEC officials.” Later, the SEC again asserted that its regulations, potentially enforceable by criminal sanctions, were applicable to Aguirre’s testimony before the Senate Judiciary Committee. Aguirre’s inquiries to the SEC in this regard date back to November 2005.
GAP General Counsel Joanne Royce stated: “It is the practice of GAP attorneys to carefully scrutinize the evidence supporting a whistleblower case before accepting it. That practice was diligently followed in examining the evidence of the SEC’s misconduct in this case. Through this lawsuit, we expect to place that evidence and more before the public.”
Royce and former Department of Justice attorney Scott Hodes are jointly representing Aguirre in his lawsuit against the SEC. GAP attorneys have represented Aguirre in Congressional meetings, and assisted him since October 2005 in preparing the OSC complaint. Hodes is a former FOIA and Privacy Act attorney for the Department of Justice and the FBI. He now practices government disclosure law.