oversight

FHFA Non-Career Employees Have Not Been Involved in FHFA's Freedom of Information Act Process

Published by the Federal Housing Finance Agency, Office of Inspector General on 2015-08-06.

Below is a raw (and likely hideous) rendition of the original report. (PDF)

           Federal Housing Finance Agency
               Office of Inspector General




   FHFA Non-Career Employees
Have Not Been Involved in FHFA’s
Freedom of Information Act Process




 Special Project  COM-2015-002  August 6, 2015
                 Executive Summary
                 The Freedom of Information Act (FOIA) was enacted to promote transparency
                 in the operations of the federal government and has been called “the law that
                 keeps citizens in the know about their government.” FOIA requires federal
                 agencies, such as the Federal Housing Finance Agency (FHFA/Agency),
                 to make available to the public various policy statements, determinations,
COM-2015-002     and other records. Recently, members of the media and Congressional
                 representatives have questioned whether some agencies have withheld or
August 6, 2015   delayed the production of information sought pursuant to FOIA for political
                 reasons.

                 On June 23, 2015, the FHFA Office of Inspector General (FHFA-OIG or OIG)
                 was asked by the Senate Committee on Homeland Security and Governmental
                 Affairs (the Committee) to determine: (1) whether “non-career” FHFA
                 officials (defined in this report as presidential appointees who are confirmed
                 by the Senate, as well as officials appointed pursuant to Schedule C of the
                 excepted service) have been involved in the Agency’s FOIA process; and
                 (2) if so, whether their involvement had an adverse impact upon the quantity,
                 quality, and timeliness of the information provided to the public through the
                 FOIA process. To respond, FHFA-OIG launched a special review. We found
                 no evidence of involvement by non-career officials in the Agency’s FOIA
                 process from 2009 (when FHFA established its FOIA office) to the present.
                 Specifically:

                       FHFA’s General Counsel, Chief FOIA Officer, and FOIA Officer (all
                        career officials) each stated, unequivocally, that to the best of their
                        knowledge, non-career officials have never attempted to involve
                        themselves in the Agency’s FOIA process. Each stated that non-career
                        officials never caused or attempted to cause them to redact, withhold,
                        or delay the release of any information through the FOIA process.

                       OIG tested the assertions of these Agency officials by reviewing a
                        sample of 20 FOIA requests that were partially denied or denied during
                        the service of non-career officials at FHFA. We found no evidence that
                        non-career officials influenced or attempted to influence FHFA’s FOIA
                        office’s decisions in these cases, or caused any delays in the processing
                        of the requests.

                       OIG also analyzed all of the FOIA-related litigation brought against
                        FHFA to date. None of the plaintiffs in these cases alleged that they
                        were denied information due to the involvement of non-career officials
                        in the Agency’s FOIA process. Our examination of the pleadings,
                        papers, and decisions in these cases found no allegations, statements,
                        or judicial findings of fact that suggested that non-career officials
                        were involved, or attempted to be involved, with the Agency’s FOIA
                        process.

                 For these reasons, OIG concludes that non-career officials have not been
                 involved in FHFA’s FOIA process. FHFA provided technical comments on a
                 draft of this report.
COM-2015-002
                 The report was prepared by David M. Frost, Assistant Inspector General,
August 6, 2015   with assistance from Wesley M. Phillips, Senior Policy Advisor, and Andrew
                 Gegor, Jr., Senior Auditor. It has been distributed to Congress, the Office
                 of Management and Budget, and others, and will be posted on our website,
                 www.fhfaoig.gov. We appreciate the assistance provided by officials from
                 FHFA in completing this special project.




                 Richard Parker
                 Deputy Inspector General, Compliance & Special Projects
TABLE OF CONTENTS ................................................................
EXECUTIVE SUMMARY .............................................................................................................2

BACKGROUND .............................................................................................................................5
      The Freedom of Information Act ..............................................................................................5
      FHFA’s FOIA Office ................................................................................................................5
      FHFA’s Non-Career Officials ..................................................................................................7
      The Committee’s Concerns ......................................................................................................8

OIG REVIEW ..................................................................................................................................9
      The Career Officials Who Administer FHFA’s FOIA Program State that Non-Career
      Officials Have Not Been Involved in It ....................................................................................9
      OIG’s Analysis of a Sample of FOIA Files Found No Evidence of Involvement by
      Non-Career Officials in the FHFA FOIA Process ..................................................................10
      OIG Analysis of FOIA-Related Litigation Involving FHFA Revealed No Evidence
      of Involvement by Non-Career Officials in the Agency’s FOIA Process ..............................10

CONCLUSION ..............................................................................................................................11

OBJECTIVE, SCOPE, AND METHODOLOGY .........................................................................12

ADDITIONAL INFORMATION AND COPIES .........................................................................14




                                           OIG  COM-2015-002  August 6, 2015                                                             4
BACKGROUND ..........................................................................

The Freedom of Information Act

Enacted in 1966, FOIA was created to enable the public to obtain information and records
from federal executive agencies. Signing the bill into law, President Johnson stated “that
freedom of information is so vital that only the national security, not the desire of public
officials or private citizens, should determine when it must be restricted.”1 More recently,
President Obama stated that FOIA “is the most prominent expression of a profound national
commitment to ensuring an open Government.”2 FOIA cannot fulfill that commitment if it is
administered in such a way as to protect political interests, rather than the public’s access to
information.

Federal agencies are required to disclose any information requested under FOIA unless it falls
under one of nine specific exemptions.3 An agency is required to respond to a request for
information within 20 business days from the date upon which the request is received by the
agency’s FOIA office. Under certain circumstances, the agency can extend the response time
by 10 business days. A requestor may file an administrative appeal from any aspect of the
agency’s handling of a request. Thereafter, the requestor may challenge the agency’s action
in federal court.4

FHFA’s FOIA Office

FHFA’s FOIA Office5 began operations in 2009.6 For administrative purposes, that office is
situated within the Office of General Counsel. It consists of a Chief FOIA Officer, a FOIA
Officer, and a FOIA Appeals Officer. The Chief FOIA Officer, who is primarily responsible

1
    Statement by President Johnson on signing FOIA. Online at www.presidency.ucsb.edu/ws/?pid=27700.
2
    Online at www.whitehouse.gov/the_press_office/FreedomofInformationAct.
3
  The exemptions are as follows: (1) information that is classified to protect national security; (2) information
related solely to the internal personnel rules and practices of an agency; (3) information that is prohibited from
disclosure by another federal law; (4) trade secrets or commercial or financial information that is confidential
or privileged; (5) privileged communications within or between agencies; (6) information that, if disclosed,
would invade another individual’s personal privacy; (7) certain information compiled for law enforcement
purposes; (8) information that concerns the supervision of financial institutions; and (9) geological information
on wells. 5 U.S.C. § 552(b).
4
    5 U.S.C. § 552(a)(6); 5 U.S.C. § 552(a)(4)(B). See also 12 CFR Part 1202.
5
    FHFA-OIG maintains its own FOIA process. This report is confined to FHFA’s FOIA process.
6
 The FHFA FOIA office began operation in 2009. Prior to that, FHFA, which came into existence on July 30,
2008, processed FOIA requests under the existing Office of Federal Housing Enterprise Oversight structure
and regulations.



                                    OIG  COM-2015-002  August 6, 2015                                              5
for the Agency’s FOIA program, reports to the Agency’s General Counsel. All of these
employees are career government officials.

The Office handles well over 100 FOIA requests per year, and processes them in accordance
with the Agency’s FOIA regulations, set forth at 12 CFR Part 1202. Figure 1, below, shows the
volume of FHFA’s annual FOIA activities for Fiscal Years 2009 through 2014, including the
number of requests pending at the start of the year, the number received, the number processed,
and the number still pending at year end.7

                       FIGURE 1. FHFA FOIA ACTIVITY, FY 2009 THROUGH FY 2014




Source: FOIA.gov.




7
 FHFA’s FOIA web page contains, among other things, an introduction to the FOIA and information about
how to make a FOIA request to FHFA and FHFA-OIG. Online at www.fhfa.gov/AboutUs/FOIAPrivacy/Pages.



                                OIG  COM-2015-002  August 6, 2015                                     6
FHFA’s Non-Career Officials8

Since it was created by Congress in 2008, FHFA has had a total of eight non-career officials.9
Of these eight, two were non-supervisory personnel who served as confidential assistants, as
opposed to policy-determining officials. Figure 2 below reflects the positions and dates of
employment of each non-career official at FHFA.

          FIGURE 2. TITLES AND APPOINTMENT DATES OF NON-CAREER OFFICIALS, 2008 – PRESENT                       T

                                                          Dates of Employment as
       Title and Grade of Non-Career Employee                Non-Career Staff           Type of Appointment
    Director, EX-02                                      7/30/2008 – 8/31/2009        Presidential Appointee
    Confidential Executive Assistant, EL-11              3/14/2012 – 7/8/2012         Schedule C
    Confidential Assistant, EL-7                         1/28/2013 – Present          Schedule C
    Director, EX-02                                      1/6/2014 – Present           Presidential Appointee
    Special Advisor/Acting Chief of Staff, LL-01         1/7/2014 – Present           Schedule C
    Special Advisor/Industry, LL-01                      1/17/2014 – Present          Schedule C
    Special Advisor/Intergovernmental, LL-01             1/19/2014 – Present          Schedule C
    Chief of Staff, LL-01                                10/6/2014 – Present          Schedule C
Source: FHFA.

FHFA’s FOIA Office began operations
                                                           FIGURE 3. TENURES OF NON-CAREER OFFICIALS,
in 2009. As Figure 3 shows, there have                                  2009 TO PRESENT
been significant periods of time from
2009 to the present when FHFA had no
non-career officials.

For the period July 2008 (when FHFA
came into existence) through August
2009, the Agency’s first director was the
only non-career official at FHFA. From
September 1, 2009 until March 14, 2012
– a period of over two and a half years –
there were no non-career officials at the
Agency: Acting Director DeMarco was                     Source: FHFA.
a career federal employee who was

8
  Following discussions with the Committee staff, OIG determined that, for purposes of this inquiry, “non-
career” employees would include those Agency employees, exclusive of OIG, who are presidentially appointed
and Senate confirmed, as well as those appointed under Schedule C of the excepted service, 5 CFR § 213.3301
(noncompetitive positions which are “policy-determining or which involve a close and confidential working
relationship with the head of an agency or other key appointed officials”).
9
    This total excludes the two presidentially appointed Inspectors General at OIG.



                                     OIG  COM-2015-002  August 6, 2015                                       7
neither appointed by the President nor confirmed by the Senate. From March 14, 2012 until
January 6, 2014, when Director Watt assumed his commission, there were only two non-
career officials at FHFA, both of whom were in non-supervisory positions as confidential
assistants to career employees.

In December 2013, the Senate confirmed FHFA’s current director, and on January 6, 2014, he
took the oath of office. Director Watt has appointed four non-career officials to assist him in
administering the Agency. As reflected in Figures 2 and 3, above, there are now six non-
career officials at FHFA.

The Committee’s Concerns

In its letter to OIG, the Committee explains that its concerns about FOIA arise from recent
media reports about the involvement of non-career officials in their respective agencies’
FOIA processes. The reports detail, among other things, occasions on which non-career
officials allegedly:

          “reviewed and scrutinized politically sensitive documents requested under FOIA—
           directly affecting what documents or portions of documents were ultimately released
           to requestors,” causing delays by their involvement; 10 and,

          “implemented an intricate review and approval process for FOIA responses, including
           redacting potentially embarrassing information . . ..” 11

The Committee’s concerns are consistent with those expressed by other stakeholders in the
FOIA process, such as journalists and other members of Congress. For example, at a recent
hearing, a reporter testified that, “[T]he Freedom of Information Act or FOIA should be one
of the most powerful tools of the public and the press in a free and open society. Instead, it’s
largely a pointless, useless shadow of its intended self.”12 At the same hearing, a member of
Congress remarked, “I’m just concerned that these agencies under whatever directives, be it
from the White House or whatever authorities, were deliberately delaying and obstructing




10
  Letter from Rep. Ron Johnson to Laura Wertheimer, Inspector General, Federal Housing Finance Agency
Office of Inspector General (June 23, 2015).
11
     Id.
12
  Ensuring Transparency Through The Freedom of Information Act (FOIA): Hearing Before the H. Comm. on
Oversight and Government Reform, 114th Cong. (2015) (statement of Sharyl Attkisson).



                                 OIG  COM-2015-002  August 6, 2015                                    8
FOIA requests in order to hide politically sensitive information or whatever information they
simply don’t want the public to have.”13

The Committee asked OIG to determine whether non-career officials have been involved in
FHFA’s FOIA process and, if so, whether their involvement resulted in any undue delay in
the Agency’s response to a FOIA request, or the withholding of any document or portion of
a document that would have been provided but for their involvement.


OIG REVIEW .............................................................................

OIG thoroughly reviewed FHFA’s FOIA process and found no evidence that non-career
officials have been involved in it.14 As we now discuss, our conclusion is based on interviews
of Agency officials who administer the FOIA process (all of whom are career officials), a
review of a sample of FOIA requests that FHFA denied in whole or in part, and an analysis
of all FOIA-related litigation brought against the Agency to date.

The Career Officials Who Administer FHFA’s FOIA Program State that Non-Career
Officials Have Not Been Involved in It

FHFA’s FOIA Office is staffed entirely with career officials, as is the Office of the General
Counsel, in which the FOIA Office is situated. At FHFA, there are no non-career officials
within the FOIA Office or involved in the FOIA process.

OIG interviewed FHFA’s Chief FOIA Officer and its General Counsel. Both stated during
their interviews and confirmed, unequivocally and under oath, that to the best of their
knowledge, a non-career official has never blocked, or attempted to block, the release of
any record or portion of a record requested under FOIA, and that no non-career official ever
attempted to negotiate the assertion of a FOIA exemption.

OIG also interviewed the Agency’s FOIA Officer, the line official who processes FOIA
requests under the supervision of the Chief FOIA Officer. She stated that no non-career
official has ever influenced, or attempted to influence, her work in any FOIA matter.



13
  Ensuring Transparency Through The Freedom of Information Act (FOIA): Hearing Before the H. Comm. on
Oversight and Government Reform, 114th Cong. (2015) (statement of Rep. Jody Hice, Member, H. Comm. on
Oversight and Government Reform).
14
   Our review does not preclude the possibility that, at some point, a non-career official may have improperly
withheld a potentially responsive document from the FOIA office, although we have found no evidence of such
an occurrence.



                                   OIG  COM-2015-002  August 6, 2015                                           9
OIG’s Analysis of a Sample of FOIA Files Found No Evidence of Involvement by Non-
Career Officials in the FHFA FOIA Process

We tested the statements of the career officials who administer the Agency’s FOIA process
by analyzing a random sample of FOIA requests denied in whole or in part by FHFA. The
universe from which we drew our sample consisted of all FOIA requests denied by FHFA in
whole or in part during times that non-career officials served at the Agency between 2012 and
2015. From this universe, we selected at random 20 files to review.

We analyzed the 20 files to identify the process used by FHFA to deny, in whole or in part,
requests for information, as well as the employees involved in those denials. Specifically,
we analyzed internal and external correspondence, certain administrative data, e.g., timelines
and logs, documents concerning the assertion of a FOIA exemption or legal privilege, and
materials withheld by the Agency. We also looked for references to non-career officials at
FHFA as well as suggestions that such an official may have been involved in the processing
of a request.

We found no evidence that non-career officials had been involved in, or attempted to
influence, the processing of any of these FOIA requests or the assertion of a FOIA exemption
or legal privilege that would preclude the release, in whole or in part, of an Agency record;15
neither did we find any suggestion that FHFA non-career officials participated in, or
attempted to influence, any decision to assert an exemption that would preclude, in whole or
in part, the release of an Agency record. We found no evidence of involvement, or attempted
involvement, on the part of a non-career official that delayed the Agency’s response to a
FOIA request, or resulted in the denial of information sought pursuant to FOIA.16

OIG Analysis of FOIA-Related Litigation Involving FHFA Revealed No Evidence of
Involvement by Non-Career Officials in the Agency’s FOIA Process

As discussed earlier, a FOIA requestor may seek judicial review of an agency’s handling
of its request in a federal district court when, for example, the agency denies the request
in whole or in part. The documents filed in such a case could provide evidence of the
involvement of non-career officials in the agency’s FOIA process, especially in the assertion

15
   Agency FOIA officials told us that when a non-career official was found to be in possession of material that
was potentially responsive to a FOIA request, the official was treated in the same manner as a career official in
possession of such material. That is, the non-career official was informed that the materials would be released,
but the official was not consulted in the decision to do so. We did not find evidence to the contrary in our
review of the files in our random sample.
16
   Although our review does not prove conclusively that non-career officials were never involved in or
influenced the processing of a FOIA request, its results are corroborative of the interview and sworn statements
of the career officials who administer the Agency’s FOIA process.



                                    OIG  COM-2015-002  August 6, 2015                                             10
of an exemption or legal privilege, redaction of documents, or delay in the release of
information through the FOIA process.

We determined that, since the inception of the Agency, FHFA has been a defendant in five
FOIA-related civil actions filed in federal district court.17 We reviewed relevant documents
from each civil action, including pleadings, moving papers and allied documents, and interim
and final judicial orders and decisions.

We found that the plaintiffs in these lawsuits did not allege that non-career officials were
involved in the decision to deny their FOIA requests. We found no documents which
suggested to us that the actions of non-career officials adversely affected the quantity, quality,
or timeliness of the information provided to the plaintiffs in these cases.


CONCLUSION ............................................................................

For these reasons, OIG concludes that FHFA non-career officials have not been involved in,
or attempted to influence, the processing of any FOIA requests or the assertion of a FOIA
exemption or legal privilege that would preclude the release, in whole or in part, of an FHFA
record.




17
     We verified the number of FOIA-related civil actions with FHFA’s Chief FOIA Officer.



                                    OIG  COM-2015-002  August 6, 2015                              11
OBJECTIVE, SCOPE, AND METHODOLOGY .................................

In order to conduct this study, the Office of Compliance & Special Projects took the following
actions:

       1. Obtained the names, positions, and dates of employment of all non-career FHFA
          employees who served at FHFA since the inception of the Agency, i.e., since
          2008.

       2. Obtained declarations under oath regarding possible interference by non-career
          officials in the Agency’s FOIA process from FHFA’s FOIA office, i.e., the
          General Counsel (who has overseen the Agency’s FOIA process since the Agency
          was established) and the Chief FOIA Officer. We also interviewed the Agency’s
          Freedom of Information Act Officer.

       3. Obtained, under the guidance of our senior statistician, a purposive sample of
          FOIA requests processed by the Agency during those times when non-career
          officials were employed at FHFA. We reviewed the contents of these files to
          determine whether they contained any indication that non-career employees had
          any involvement in, or impact upon, the Agency’s FOIA process. Specifically, we
          reviewed:

              a. Documents (email messages, notes, memoranda, etc.) for mentions of
                 involvement by a non-career official in the processing of FOIA requests; or

              b. Assertions of the exemption in 5 U.S.C. § 552(b)(5), especially to interpose
                 the deliberative process privilege.

           If a case reflected either of the above concerns, then we pursued the matter further;
           that is, we reviewed the contents of the file more extensively to determine whether
           the available information tended to show that a non-career employee exerted
           undue influence over the FOIA process. Our review did not reveal the existence
           of such information.

       4. Assessed FOIA litigation in which FHFA was involved during the period 2008 to
          the present to determine whether key documents in these cases indicated that non-
          career officials at the Agency influenced the denial or partial denial of the FOIA
          requests then at issue. Specifically, we reviewed pleadings, moving papers and
          allied documents, and final and interlocutory judicial decisions for suggestions of
          any such influence. Again, our review did not reveal evidence indicating that non-
          career officials influenced the Agency’s FOIA process in any of these cases.


                             OIG  COM-2015-002  August 6, 2015                                   12
We conducted our review under the authority of the Inspector General Act and in accordance
with the Quality Standards for Inspection and Evaluation (January 2012) that were
promulgated by the Council for the Inspectors General on Integrity and Efficiency. FHFA
provided technical comments on a draft of this report, which were included in the final report.




                              OIG  COM-2015-002  August 6, 2015                                 13
ADDITIONAL INFORMATION AND COPIES .................................

For additional copies of this report:

      Call: 202-730-0880

      Fax: 202-318-0239

      Visit: www.fhfaoig.gov



To report potential fraud, waste, abuse, mismanagement, or any other kind of criminal or
noncriminal misconduct relative to FHFA’s programs or operations:

      Call: 1-800-793-7724

      Fax: 202-318-0358

      Visit: www.fhfaoig.gov/ReportFraud

      Write:

                FHFA Office of Inspector General
                Attn: Office of Investigation – Hotline
                400 Seventh Street, S.W.
                Washington, DC 20024




                               OIG  COM-2015-002  August 6, 2015                         14