Department of Labor (DOL) officials ignored recommendations they were given in a tax-paid study they commissioned by the Sandia National Laboratory for a study of security flaws in the government's "lockup" process for releasing new unemployment and other economic data, according to a congressional committee chairman.
In addition, Sandia researchers were prevented from studying the whole process by which DOL conducts the process known as "lockups" because participating journalists are locked into a secured room where they can prepare stories on the new data that are published at the same time it is officially released.
“In particular, the report notes that Sandia did not examine all potential vulnerabilities in the data dissemination process and that Sandia found unexamined flaws in the process that potentially put the sensitive economic information handled by the department at significantly more risk than the lock-up procedures,” said House Oversight and Government Reform Committee Chairman Darrell Issa said in a letter in a letter to Secretary of Labor Hilda Solis.
“Thus, while the department changed the lockup procedures in a manner that infringed on the First Amendment rights of reporters, it simultaneously ignored Sandia’s warning that other department procedures put the sensitive economic information handled and disseminated by the department at potentially greater risk,” Issa said.
Solis declined to appear before Issa's committee last week during a hearing at which her department's public affairs chief was grilled about details of his proposal to force reporters participating in the lockups to use only government computers and software.
The proposal sparked vigorous protests from Bloomberg News, Dow-Jones, Reuters-Thomson and other media organizations whose reporters have participated in the lockups for years using their own hardware and software.
Carl Fillichio, DOL's senior communications adviser, told the Issa panel the changes were needed because of security flaws that compromised the integrity of the lockups and enabled unnamed groups involved in the lockups from gaining micro-second headstarts in distributing the new data.
Millions of shares of stock can be bought or sold on Wall Street based on how experts analyze the new data.
Fillichio told Issa his proposal was based on the Sandia study but he declined to provide the committee with an uncensored copy of it before or during last week's hearing. According to Issa's letter to Solis today, the committee staff was only allowed to review the study after further negotiations following the hearing.
Fillichio agreed during the hearing to Issa's request that DOL suspend its plan to change the lockup process, pending talks between the government and major media groups on a compromise.
Fillichio said then that DOL would release a new timetable early this week, based on the continuation of the talks. Spokesmen for the media groups said today they have not yet received the new timetable.
A DOL spokesman has been asked for comment on the Issa letter.
For additional information on the "Lockups" issue, see: