A Congressman has moved to repeal the controversial section of the sweeping Wall Street reform bill that appears to give the Securities and Exchange Commission more power to reject requests for information from the public.

Rep. Darrell Issa (R-CA) on Wednesday introduced legislation that would undo section 9291 of the Dodd-Frank Wall Street Reform and Consumer Protection Act that allows the SEC to not "disclose records or information" that are typically subjects of Freedom of Information Act (FOIA) requests. 

In a statement, Issa said Congress’ approval of the section is “just the latest example of Congress passing and the President signing legislation into law without fully understanding what’s in it.” The provision, according to Issa, “shields the SEC from the transparency and accountability this reform bill was supposed to represent.”

The Congressman added, “Both Democrats and Republicans alike should agree that we cannot allow this regulatory body that failed to catch Allen Stanford's fraud and Bernie Madoff's Ponzi scheme to operate in secrecy.”

The FOX Business Network first reported the provision and its potential impact in July after the SEC cited the new law in a FOIA action brought by the network.

The law 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, according to legal experts. Congress and federal agencies can request information, but the public cannot.

After FOX Business reported on the law and it was widely covered by the media, many members of Congress admitted that they were unaware of its inclusion in the vast Dodd-Frank reform bill.

The SEC has defended the provision, suggesting it will help the agency in its efforts to expand its surveillance and investigations by ensuring that information obtained from banks and other financial institutions to remain confidential.

SEC Chairman Mary Schapiro will make that argument on Thursday before a Congressional committee looking into the provision, according to Schapiro’s prepared remarks. She is expected to argue against repealing the provision.

Ahead of that hearing the SEC on Wednesday issued guidance on the new law apparently intended to ensure that SEC staffers do not withhold information that should be released to the public.

According to the guidance, the provision is “designed to protect the confidential and proprietary information of regulated entities and foster and open examination process – not to protect the Commission or any Commission employee. Public oversight and transparency is essential and the staff may not invoke 9291 to withhold information to protect the Commission or a Commission employee.”

Issa, in a letter to Schapiro in response to the new guidance, said the SEC is already using the provision to “avoid embarrassment and hide evidence of its regulatory and management failures.”

Critics such as Issa have argued that more transparency is needed if government regulators hope to avoid more well-publicized debacles such as Madoff’s $65 billion Ponzi scheme and the alleged fraud orchestrated by financier R. Allen Stanford.

Furthermore, the critics note, one of President Obama’s recurring campaign pledges was to increase transparency in Washington.

Issa has been invited to sit in on Thursday's hearing before the House Financial Services Committee.