If the Equifax security breach didn't get investors attention -- and it should have -- the hack of Edgar will.
Edgar stands for Electronic Data Gathering, Analysis and Retrieval system. It is the Securities and Exchange Commission's online filing system for all kinds of financial data by publicly traded companies. Most of that data is publicly available for investors once it hits the SEC's servers. You want to know sales data, profit projections and if insiders are buying or selling, Edgar knows.
SEC Chairman Jay Clayton is scheduled to appear before the U.S. Senate Banking Committee on Tuesday in the week ahead. While the agency has acknowledged knowing about the hack in 2016 and learning that it may have been used for illegal trading, it has been short on details.
The SEC requires companies it regulates to disclosure news that is relevant to investors. By not disclosing its own cyber breach until now, the SEC has violated its own rules for the public companies it polices.
Edgar is designed to help level the information playing field between the nano-second, computer-aided professional traders and retail investors. It's vulnerabilities have been exploited in the past, but its reputation as the repository of accurate and timely data has remained intact.
The SEC has weathered previous compromises, such as fake documents or premature access to data by some users but not all. However, the admission of this hack comes just two weeks after credit reporting agency Equifax said personal data on 143 million Americans may have been stolen.
The Equifax cyber breach of data may shake some consumers to reexamine their credit, but the SEC, as the stock market's top cop, can't afford to rattle investor confidence.
Financial journalist Tom Hudson hosts “The Sunshine Economy” on WLRN-FM in Miami. Follow him on Twitter @HudsonsView.