The United States District Court for the District of Columbia has resolved a two-and-a-half-year battle over whether the Bureau of Consumer Financial Protection must release, under the Freedom of Information Act, documents related to the Bureau’s enforcement action against—and eventual consent order with—Portfolio Recovery Associates (PRA). In Frank LLP v. Consumer Fin. Prot. Bureau, in favor of the ruled in favor of the BCFP, concluding that disclosure of the techniques of its investigators would “allow criminals ‘to adjust their responses and behavior to circumvent the law,”
In February, 2016, Frank LLP (Frank) submitted a FOIA request seeking the documents at issue. Frank represents plaintiffs in a suit against PRA, and it claimed that “[r]ecords and information in the CFPB’s possession that pertain to the CFPB’s findings against PRA and its attorneys constitute evidence that would greatly strengthen the claims of the plaintiffs and putative class.” The Bureau’s ultimate response included redacted versions of two investigational hearing transcripts, and in support of the redactions the Bureau invoked 5 U.S.C. § 552(b)(7)(E), which allows a federal agency to resist a FOIA request if
it pertains to “records or information compiled for law enforcement purposes, but only to the extent that the production of such law enforcement records or information . . . would disclose techniques and procedures for law enforcement investigations or prosecutions, or would disclose guidelines for law enforcement investigations or prosecutions if such disclosure could reasonably be expected to risk circumvention of the law . . .
Concluding, that the investigational hearing transcripts at issue were “compiled for law enforcement purposes,” the Court held that an agency satisfies this requirement when it establishes a “rational nexus” between an investigation and one of the agency’s law enforcement duties and a connection between an individual or incident and a possible security risk or violation of federal law. In this case, the Bureau argue that “the very fact that the two transcripts are responsive to Frank LLP’s FOIA request demonstrates that the transcripts were compiled for law enforcement purposes” because Frank sought documents that the Bureau relied upon in making a specific finding of fact in the Bureau’s consent order with PRA, resolving an enforcement action against PRA.
The Court rejected Frank’s argument that the Bureau’s methods in questioning witnesses “do not amount to ‘techniques and procedures’ for purposes of Exemption 7(E) withholding, because the CFPB could not have employed any interviewing methods that are particularly unknown to the public,” noting that that investigative questioning can qualify as a “technique” or “procedure” that is subject to the exemption. Although the outcome is a victory both for the Bureau and for present and future targets of investigations whose investigations might otherwise be exploited by plaintiffs’ firms, it is also a loss for those who wish to prepare for Bureau investigations. The court concluded:
The Petersen declaration avers that disclosure of the redacted portions of questioning would “provide a blueprint to other entities not yet under investigation, or currently under investigation, of the types of information the Bureau seeks in an [investigational hearing] to determine whether there have been violations of law, particularly with respect to the filing of affidavits in debt collection litigation,” and that those entities could then “coach future witnesses in similar cases on how to avoid providing incriminating information, hindering the future use of these investigative techniques, and thus lead to circumvention of the law.” The CFPB has also identified a risk that “knowing the type of information on which the Bureau relies, including documents, to establish violations for conduct similar to that of PRA increases the risk that other entities under the Bureau’s supervision will create or not create specific documents, such as policies, procedures, or training materials just to avoid liability.”