December 22, 2007
File No. S7-27-07
CONCEPT RELEASE ON MECHANISMS TO ACCESS DISCLOSURES RELATING
TO BUSINESS ACTIVITIES IN OR WITH COUNTRIES DESIGNATED AS STATE
SPONSORS OF TERRORISM
Unfortunately I did not have a chance to test and experience the SEC webtool for accessing disclosures about business dealings with known terrorist sponsoring nations because this tool existed for such a short period of time.
Having no direct experience with your webtool, I would be remiss to comment on usage and technical issues.
However, I can comment on personal experiences related to our shared concerns about inadvertently supporting terrorism. Although this reads unfair, when I come across surnames in Edgar filings which suggest nationality origin of a region known for supporting or producing terrorists and terrorist activities, I become very concerned. My personal attitude extends beyond our officially listed state sponsors of terrorism. I share this to reflect this fear of the many around our world. This fear of terrorism is now deeply ingrained within our daily thinking.
Within our stock trading community, this fear is well known and discussed. All of us are aware terrorists are involved in our stock markets to raise funds for terrorism, just as all of us are aware terrorists are becoming more sophisticated and more savvy about securing money, secretly.
Although we are fearful, we cannot expect the SEC to require more nor investigate beyond disclosures by filing companies. Any activities beyond a requirement of disclosure is best left to our intelligence community and our justice system.
I do expect our SEC to be prompt with reporting disclosure of companies doing business with or having contacts with known terrorist sponsoring states. I am aware this is a daunting task which is both time and labor intensive. Nonetheless, we do need an alert system to notify our public of these possible problems. Because this reporting to the public is a difficult task, my opinion is a majority of the burden of disclosure and reporting should be laid upon the shoulders of companies. This seems a responsibility of all, our public and our public companies. Expecting our SEC to assume virtually all responsibility for alerting the public is counterproductive.
My position is all publically traded companies should be required to notify the SEC of either no involvement or involvement with terrorist states, each quarter. Additionally, if there is a change of status on this, companies should be required to report this within five to ten business days, to the SEC. Costs of reporting requirements like this could and would be minimal. Companies have an option of postal mail, email, fax or electronic filing. A short simple SEC form could be provided through a variety of means. Clearly costs are very minimal for this type of reporting.
Having reporting requirements for this information once every quarter would allow the SEC to gear up for processing this information much like the SEC processes quarterly reports. Current staff could, most likely, handle these extra reports if the format is concise and easy to transfer into the SEC electronic system.
On mechanisms to convey this information to the public, a webtool would be very good, and this reporting should be added to the SEC Edgar system as unique filings which lends to easy access. Many may not use a webtool but many do look through Edgar filings during research. I feel the public is responsible for finding this information. The SEC should only be responsible for making this information available through a webtool and through the Edgar system. The SEC should not be responsible for making sure the public accesses this information.
A inherent problem comes about, a lack of teeth for enforcement. My suggestion is these quarter based terrorism reports should be treated the same as late quarterly filings. If a report is late, a traditional E should be added to a ticker, and all current rules covering late quarter filings should be applied.
To close, fighting terrorism is of critical importance. We know the horrific costs of terrorist events. Any costs of strict reporting requirements pales in comparison to the costs of a terrorist event such as the 9-11 event we suffered so greatly and still suffer. Strict SEC requirements for disclosure of direct or indirect dealings with state sponsors of terrorism may seem too little for some, may seem too much for others. Nonetheless, measures like this, no matter how small, lends well to our overall war on terrorism. This is a war we cannot afford to lose, all of us are directly responsible for performing our part in this war against terrorism.
Best regards,
Kiralynne Schilitubi
Professor of English
Choctaw Nation