§57b–2a Confidentiality and Delayed Notice of Compulsory Process for Certain Third Parties

Summary

Lets the Commission and courts delay or block telling people that the Commission has served a legal demand for records or testimony when telling them could harm an investigation. The Right to Financial Privacy Act and chapter 121 of title 18 normally apply to the Commission unless this part says otherwise. A judge can order delayed notice or a ban on telling others if the judge finds there is reason to believe telling would cause an "adverse result." The Commission can also delay notice itself under chapter 121 by filing a written certification if it finds such a risk. If neither of those laws requires notice, the Commission can ask a judge without telling the recipient (ex parte) to bar the recipient from telling anyone about the demand for up to 60 days. The judge may extend that order in 30-day steps, but the ban cannot last more than 9 months in total. Those secrecy orders apply only when the person or company getting the demand is not a target of the investigation at the time they receive it. Orders do not stop the recipient from telling a Federal agency that they received the demand. Recipients who are not required to give notice will not be legally punished for failing to tell others about the demand, except if they committed the underlying wrongdoing, broke record-retention rules under section 1104(c) when those apply, or failed to tell a Federal agency that they received the demand. Court actions under these rules can be filed in the District of Columbia or another proper federal court and may be held in private with records sealed while the delay is in effect. This part does not apply to antitrust investigations. Defined term: "adverse result" — harm such as endangering someone's safety, flight from prosecution, destroying or tampering with evidence, intimidating witnesses, or seriously harming an investigation or trial by hiding or moving assets, blocking the Commission from finding people or tracing funds, or hiding assets that could be recovered.