Yesterday afternoon, Fox Business Network* seemed to have posted quite a scoop:

Under a little-noticed provision of the recently passed financial-reform legislation, the Securities and Exchange Commission no longer has to comply with virtually all requests for information releases from the public, including those filed under the Freedom of Information Act.

The law, signed last week by President Obama, exempts the SEC from disclosing records or information derived from “surveillance, risk assessments, or other regulatory and oversight activities.” Given that the SEC is a regulatory body, the provision covers almost every action by the agency, lawyers say.

“Virtually all requests.” “Almost every action by the agency, lawyers say.” Sounds pretty drastic.

But I’m wondering who those lawyers are. Because Steve Mintz, Fox Business’s go to FOIA lawyer, isn’t one of them.

“To be clear,” Mintz told CJR, “what we’re talking about is the information that the FEC gathers as parts of various books and records obligations under either the ’34 act or both of the ’40 acts.”

Those would be the Securities and Exchange Act of 1934, the Investment Company Act of 1940, and the Investment Advisers Act of 1940. “Books and records” essentially means just that—financial records that the SEC requires the institutions it oversees to maintain for their inspection.

“When people have a books and records obligation, have materials, and the FEC thereafter obtains that information from them pursuant to books and records obligations, that material is exempt,” says Mintz.

So, in other words, financial records that an investment company is required to maintain—but not to disclose in public filings—and that the SEC collects, may now be exempt from FOIA requesters.

I contacted the SEC to ask them what they made of Fox’s report. They sent over a statement which has been published elsewhere in full. Here’s a relevant except:

The new provision applies to information obtained through examinations or derived from that information.

“Derived” could mean a wide range of products. But it’s clear that we are already a long way from a blanket exemption of the SEC from all FOIA requests, even though Media Matters, naturally, has compiled a list of Fox personalities speaking about it that way.

On its face, this does seem like it could be a major expansion of the Commission’s ability to withhold from the public this sort of information. (Though, as the Project on Government Oversight points out, records containing trade secrets are already exempt from FOIA under the original statute.)

And the new exemptions could, like all FOIA exemptions, be ripe for abuse. The SEC made the claim in a case where Fox is seeking information that might illuminate how the Allen Stanford and Bernie Madoff scams went undetected by the SEC until it was too late.

Fox is absolutely correct that there is a provision limiting FOIA’s reach at the SEC in the Financial Reform Bill. (That’s section 9291(e). You can find it on page 483.) The SEC says that it merely extends the status quo for how it treats FOIA requests for information it obtains while conducting examinations to information it will collect under the new law’s mandate for “risk assessment and surveillance.”

Beyond FOIA’s listed exemptions—which have been defined by over forty years of federal court litigation—the law permits information to be withheld if some other law forbids releasing some category of information. These are known as b(3)b exemptions, for the portion of the law allowing them. Sometimes they are quaint (but still access-perturbing) provisions, protecting, say, watermelon handlers from having their business information disclosed.

But they can strike at more high profile issues, like in this case, or in the special law that allows the government to withhold photographs depicting detainee abuse.

The detainee photo exemption was slipped into an October 2010 Homeland Security appropriations bill. In that very same bill (in fact, ironically, in the section immediately preceding the detainee exemption), Congress required that all future b(3)b exemptions specifically cite back to the portion of the law allowing them. In short, it required that if Congress wanted to make up a new FOIA exemption, they had to explicitly say that was what they were up to. The provision was called the OPEN FOIA Act.

And, in compliance with that law, Section 9291(e) does exactly that. At the time of passing OPEN FOIA, it was hoped that, by explicitly identifying new exemptions, the requirement that new exemptions specifically cite back to FOIA would raise awareness that a new exemption was under consideration, and give people opposing any new carve-out an opportunity to make their case. Anyone remember that happening here?

The extent of the SEC’s new b(3)b, though more limited than Fox has described it, remains undefined. The agency will have to argue a case in court as to what they take records or information obtained for “surveillance, risk assessments, or other regulatory and oversight activities” to mean. (The SEC’s statement speaks of including products derived from this category, a step towards expansiveness.) And judges will, as they have in litigation around other FOIA exemptions, have to make some decisions about what congress intended here.

But one thing’s clear: they didn’t intend to exempt the SEC from each and every FOIA, no matter what someone on Fox Business says.

CORRECTION, 7:30pm: It’s Fox Business Network, not “Fox Business News”, as the article originally had it. The text has been corrected.

Clint Hendler is the managing editor of Mother Jones, and a former deputy editor of CJR.