I decline to authorize issuance of the omnibus Investigation Order, delegating to the Division of Enforcement sweeping subpoena power to investigate possible [redacted] activities [redacted]. I objected to the issuance of a similar omnibus order, which expired on May 20, 2013. While I strongly support a robust enforcement regime, I object to the process of waving the Commission’s power to authorize an investigation, especially in the post Dodd-Frank environment.
As with the previous Order, this Order gives the Division of Enforcement far-reaching subpoena authority to investigate possible violations of the rules adopted pursuant to Dodd-Frank. Many of these investigations will involve new and untested laws. If delegated to staff, I am concerned that the Commission will be unaware of the full ramifications of the new laws. Therefore, it is crucially important for the Commission to assess the legal and factual bases for initiating investigations on a case-by-case basis, and not hand-over this responsibility to the Division of Enforcement at this time.
But what I find even more troubling is that the Division of Enforcement seeks to circumvent the powers of the Commission as it proposes to bring investigations on a summary basis by utilizing an absent objection process. As I understand, the Division of Enforcement proposed the same process in an earlier request to issue an omnibus subpoena. Since that time, unbeknownst to me, the legal powers of the no-objection process have been re-interpreted by the Commission’s Office of the General Counsel. Now, I am advised that the Commission cannot block a staff initiated “absent objection” circulation because this process is not a Commission vote.
One of the distinguishing characteristics of an independent agency, such as the Commission, is the ability of the agency to prosecute violations of its statute and rules.1 To ensure fairness in terms of true separation of functions, Congress gave power to the Commissioners to reconsider staff’s recommendations by independently assessing facts and legal justifications for initiating various actions. In other words, Congress intended a decision to bring an investigation to be reflective of a shared opinion of the majority of the Commissioners rather than a unilateral ruling of the Division of Enforcement’s staff.
While I support the Division of Enforcement’s efforts to expeditiously investigate possible [redacted] activity, I also recognize that the Commission possesses certain responsibilities to execute its law-enforcement powers that should not be brushed off to achieve an “efficient” investigative process.
Thus, I would encourage the Commission to preserve its powers, act as an independent agency, and review each enforcement matter on its own merits. For my part, I am committed to considering each enforcement matter in an expedited fashion, so not to delay the Division of Enforcement’s investigative work.
1 “Whenever it shall appear to the Commission that any . . . person has engaged . . . in any act or practice constituting a violation of any provision of this Act or any rule, . . . the Commission may bring an action in the proper district court of the United States . . ..” (emphasis added). CEA § 6c(a), 7 U.S.C. § 13a-1(a).