The SEC’s Terrorism Tool Comes Under Fire

A few weeks ago, I mentioned the SEC’s new “terrorism tool:” a way of winnowing out publicly-traded companies who carry on business in countries denoted by the State Department as sponsors of terrorism.

The tool is neat in that it weaves information from the State Department (the list of fingered states) with the SEC’s EDGAR database. For those people who want to know what their investee companies have been doing in this arena, it’s a help. Even if they’re not currently working in those states - perhaps a company may have divested its operations in one of those countries - the tool would disclose their recent activities.

CFO.com reports that Rep. Barney Frank, chairman of the House Committee on Financial Services, has sent a letter to SEC Chairman Christopher Cox criticizing the accuracy of the web-based tool. He’s concerned that the disclosure of past practices would taint the image of companies that no longer deal in those countries.

Furthermore, Rep. Frank mentions that the “House Financial Services Committee is considering the Iran Sanctions Enabling Act, which would list companies active in that country’s energy sector. The act would have a $20 million threshold for inclusion on the list. Frank said that decision was “out of consideration for the competitive standing of the U.S. capital markets.”"

“Out of consideration for the competitive standing of the U.S. capital markets?” One takes that to mean that just a little support of terrorism sponsors is okay, as long as companies remain competitive. That’s ridiculous. If investors have a problem with their investee companies dealing with state sponsors of terrorism, there shouldn’t be protective cover under which they can work.

Comments

[john olagues]

Your article is disguised cheap propoganda for the real terrorists.

"you all are either againts the terrist or you are with 'em" GWB