KEY ELECTION SOLUTION: EO Mandating Process and Control Audits Before Elections, Performed by Independent Auditors to Ensure Election Integrity.
Synopsis:
To fix US elections, President Trump should sign an Executive Order that mandates elections adhere to a Sarbanes-Oxley like mandate that ensures all election processes are well controlled. This will force elections to be more secure through the elimination of systems and other non-certifiable election actions which are not well controlled.
Missing Process Controls Make US Elections Uncertifiable
Sarbanes-Oxley (SOX)
Around the turn of the millennium, several publicly traded companies, including Enron and WorldCom, used accounting trickery, shell corporations, and other fraudulent techniques to hide business losses from the public and keep stock prices artificially high. These corporate failures led to the passing of the Sarbanes-Oxley Act (SOX).
The provisions of SOX apply primarily to companies whose shares are traded on public stock exchanges. These companies are legally required to establish a financial accounting framework that is transparent, timely reported, vouched for by executives, effective in preventing fraudulent results, regularly reviewed by registered independent experts, with severe penalties for anyone who alters documents, impedes investigations, or certifies fraudulent financial results.
SOX caused major changes in the financial reporting of all US corporations. Up until this point in time, corporations would provide support for their balances and entries made in the financials, but SOX took the credibility of financials a step further.
Going forward, support for financial entries was not enough. The processes involved in financial reporting also had to be well designed, put in place, audited, and signed off on along with the financials on a periodic basis.
After its passing, many companies didn’t know where to start to comply with SOX. They soon figured out that to comply with SOX, they would have to identify all the processes involved in financial reporting. This included all the systems and all the entities involved in financial reporting. Next, key controls within those processes that were necessary to ensure accurate financial reporting had to be identified, in place, designed properly, and audited on an annual basis. The results of these process and control reviews were then signed off on, not just by corporate management, but by external auditors as well.
For some multi-national companies, the implementation of SOX meant that over 1,000 key controls had to be tested each year. Testing is performed by internal and external auditors all year long. If a control is not in place, not working, or designed poorly, the control issues are addressed, and the control is retested. ALL KEY CONTROLS must be in place and working properly before the external auditor signs off on a company’s financials reported to the public.
Although this was a lot of work, this wholesale change in attitude towards processes and controls eventually became part of the business of financial reporting. Today this work is completed and signed off on at least annually.
The Result of US Elections Not Adhering to SOX or a SOX-like mandate.
Compliance with SOX is not a requirement in US elections and as a result elections are not transparent, timely reported, effective in preventing fraudulent results, nor regularly reviewed by registered independent experts. Severe penalties for anyone who alters documents, impedes investigations, or certifies fraudulent financial results are seldom identified or prosecuted.
Election systems are off limits and not rigorously or adequately audited. Processes ensuring adequate controls like chain of custody are not rigorously audited or signed off on.
As a result, in US elections there is evidence that the systems used in the election process are not secure and that the bad actors can hack into the systems and potentially adjust results (See CISA Report).
Systems with security issues in the corporate world are immediately shut down and not used until they are safe for use again. Corporations cannot afford to have their data tampered with, stolen or contaminated by bad actors outside the entity.
As noted above, for US Corporations all controls have to be designed properly, implemented, working, audited and signed off on. In contrast, in the US election process, according to one study, only one-third of all controls are even in place. The US election process is a disaster.
As noted above, all controls related to financial reporting in a corporation are tested annually to determine they are working as intended. External auditors rely on the results of this work in their annual audits of financial statements. ALL key controls must be in place.
Things are much, much different with US elections. The absence of SOX or SOX-like mandates result in elections where the majority of key controls are not even in place let alone tested and signed off on annually by experts.
An Executive Order is Recommended
It is imperative that election processes be tested and certified before elections take place. After the election is not when this should be done. It should be completed before every election.
Here is a draft of an Executive Order that we recommend President Trump sign and put in place to ensure safe, secure, timely, accurate and transparent elections.
Executive Order [ # / Date ]
ORDER TO MANDATE THE IDENTIFICATION, DESIGN, IMPLEMENTATION, AUDITIING, AND INDEPENDENT SIGN-OFF OF FEDERAL ELECTION MANAGEMENT CONTROLS BEFORE ELECTIONS TAKE PLACE
By the authority vested in me as President of the United States pursuant to the Constitution and laws of the United States of America, including Article 2 section 1 of the U.S. Constitution, Executive Orders 13800 – Executive Order on Strengthening the Cybersecurity of Federal Networks and Critical Infrastructure, and 14248, Preserving and Protecting the Integrity of American Elections, and all applicable Executive Orders and laws and regulations pertaining to the activities involved in US Elections:
I, Donald J. Trump, President of the United States, find that since the issuance of Executive Orders 13800 and 14248, the process for assuring that American elections are in compliance with all laws, including these Executive Orders related to election processes and activities before and after the elections take place, is lacking the proper attention and independence that is required in other professions like those involved in the financial reporting activities for US corporations.
In corporate America all key controls related to the financial reporting process are inventoried and tested annually as mandated by the Sarbanes-Oxley legislation. For multinational companies this can mean hundreds of key controls are tested each year. Testing is performed by internal and external auditors throughout the year. If a control is determined to be not in place, not working, or designed poorly, the control issue(s) are addressed, and the control is retested and/or redesigned until it is working as intended. ALL KEY CONTROLS must be in place and working properly before the external auditor signs off on a company’s financials which are reported to the public.
The same rigorous work should take place in elections before certifying election results.
Sec. 1. Purpose. In American elections today, compromised voter registration systems allow outsiders access to the voter rolls, while there is also inadequate voter verification and in some states it’s even illegal to ask for an ID to vote. There are also unrestricted mail-in or absentee ballots, ballot harvesting, early voting, and counting after Election Day. Also, there’s unaccountable ballot printing and distribution, and substandard or missing chain of custody procedures accompanying the ballot return processes.
The current use of uncertifiable election computers with security issues and proprietary software containing millions of lines of code that goes untested by independent experts does not meet Election Assistance Commission (EAC) Standards. As a result, citizens are unable to select their representatives in a transparent manner. Overall, the current election system, infrastructure, processes and controls are in many cases the antithesis of election transparency necessary and in place in free and fair elections.
Sec. 2. Scope. Article I, Section 4 of the Constitution establishes that the State Legislatures are responsible for establishing the procedures for holding elections of their Federal Senators and Representatives. Nothing in this Executive Order shall be construed to restrict states’ power to manage their statewide elections, however the election of federal offices administered by the states must meet all Federal mandates addressed in this Executive Order.
Sec. 3. Policy. For our election system to truly serve its purpose, it must be so simple and transparent that every citizen, regardless of their background, education, or technological literacy, can participate. At its essence, voting involves citizens making their choices for individuals who serve them.
Because Elections are a critical function of this country, and to aid entities of all sizes in the adherence mandated in election laws to date and going forward, I hereby order:
(1) All election equipment, policies, procedures and controls used in American elections shall be in place and performing in accordance with, and in the same fashion that processes and controls are in place and performing in the financial reporting processes in corporate America, conforming with Sarbanes-Oxley mandates.
All election processes, including but not limited to, voter registration, voter verification, election day administration, absentee ballots, ballot printing and distribution, chain of custody activities, elections systems, ballot counting, reporting, and enforcement, are to be properly documented and all related key controls are to be working with no exceptions in compliance with election laws and regulations.
The local election supervisors and state leaders are accountable for the management of election processes and systems that follow election laws and working where election exceptions are identified, addressed, corrected, not included in final results and fully transparent. Certification of all elections are of a serious legal manner, and not ‘ministerial’.
(2) All election equipment, policies, procedures and controls used in American elections shall be audited in accordance with, and in the same fashion that processes and controls are audited in the corporate world when certifying financial statements according to Sarbanes-Oxley mandates. Auditors are to be hired to provide independent certified opinions of the entity’s compliance with applicable laws and regulations. The auditors involved in ascertaining and signing off on assessments stating that American elections are legitimate, accurate, legal, and in compliance of all applicable laws and regulations, must be independent, professional and protected from political efforts to reward or punish them which might interfere with their ultimate unbiased audit opinions.
To maintain independence, the auditors on each engagement must come from professional auditing firms and be granted immunity from any legal action taken against them by bad actors. The mix of auditors on each engagement and location should consist of individuals from multiple firms so that individual firms cannot be targeted. A lead auditor on each engagement should come from one of the firms involved in the engagement.
(3) Individuals who interfere with or attempt to coerce certain results from the auditors in each engagement will be held accountable to the full extent of the law.
(4) All election processes, controls and related issues must be resolved by the local entity one month before election day for primary and general elections.
(5) Any supervisors and people in charge of the entities that are not in compliance with applicable laws and regulations, and which do not address audit findings satisfactorily by the timeframes required, will be subject to fines and possible imprisonment. This includes those overseeing elections in each state.
(6) Within 7 days of issuance of this Executive Order, an initial assessment of findings must be provided to the Office of the Director of National Intelligence. The final assessment must be provided to the Office of the Director of National Intelligence no later than 60 days.
(7) Within 7 days of receipt of this assessment, the Director of National Intelligence shall deliver this assessment and appropriate supporting information to the President, the Secretary of State, the Secretary of the Treasury, the Secretary of Defense, the Attorney General, and the Secretary of Homeland Security. Included will be a blueprint on how to implement the activities mandated in this Executive Order across the country.
(8) A direct liaison will be authorized to coordinate as required between the applicable U.S. Departments and Agencies. Additionally, if the Secretary of Defense chooses to federalize appropriate National Guard resources or local law enforcement , they will coordinate support requirements as needed along with the Department of Homeland Security.
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DONALD J. TRUMP, PRESIDENT OF THE UNITED STATES
Here is a pdf of this proposed EO:
By mandating elections adhere to the same control mandates as financial reporting, poorly designed election systems will become uncertifiable, and elections will end up being secure, timely, accurate and transparent.
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