Mar. 31, 2023
March 31, 2023 With regard to financial industry sector funds: The cost of this amendment would be borne by employees who currently hold these funds, and who would be forced to sell. The Commission claims it is unable to quantify these costs, but how can that be the case when all such holdings are reported to the Commission by its employees? The Commission must know, or possess the paperwork to allow it to know, exactly how many employees hold these funds and in what amounts. The Commission should disclose the aggregate cost it means to impose on employees. With regard to diversified investment funds: It would be simpler if the Commission eliminated the reporting requirements for standard retirement vehicles such as 401(k) and IRAs. These are common accounts that present very low ethical risk, but are a significant reporting burden. With regard to automated reporting: The proposal says the DAEO may require employees to use an automated transmission system but permit other means, presumably self-submission of the statements as is done today. Those should be reversed: the DAEO should permit the use of an automated transmission system by those who find it useful, but always allow (and retain the authority to require) self-submission. This is supported by concerns and costs of the proposal that were not considered in the release, such as: 1. Employee time spent explaining to multiple banks/brokerages/others what action is required and why (to include sitting on hold with customer service, sending letters, obtaining some proof for DAEO that the institution declines to cooperate, shutting down transmission when it is no longer required, etc., all for multiple accounts). 2. Employees remaining responsible for the accuracy and completeness of the reporting even though the process is out of their hands and could fail, such that the need to check on the reporting undercuts any efficiency savings. 3. Cost of data breaches caused by third parties or made more likely by additional transmissions. 4. Risk of jeopardizing national security clearances that employees' spouses may hold for their employment (common to jobs in the DC area) because financial information is being disclosed to a third party or is at greater risk of disclosure through a data breach.