Whenever someone is holding your money, you kind of want to a lot of about it, don’t you? You want to know how much, where they hold it, and when you get it back, right? Seems reasonable. But not only does the MLC hold what is likely to be hundreds of millions in black box money, they don’t really tell you these attributes, do they?

Plus they tell you that somehow the Music Modernization Act authorizes them to invest your money in the open market to obtain some theoretical government mandated rate of return, yet the Copyright Act says nothing of the kind.

They then refuse to disclose how they intend to invest OPM and who bears any losses and makes any profit from these open market transactions. They don’t just refuse to tell songwriters, because why tell them whose money it is, they don’t just refuse to tell the Copyright Office who is tasked by Congress with overseeing their operations, they also dodge answering questions from the very Congressional committee that oversees the MLC.

The other problem is that the longer the MLC delays in distributing the black box to the correct copyright owners, the more likely it is that the MLC will choose the nuclear option–market share distribution to the copyright owners who are overrepresented on the MLC’s board without regard to copyright ownership. And just to be clear what that means, it means the black box money is going to get shared with people who aren’t entitled to it thus leaving lots of hungry people.

Many people believe that this is exactly the intent and that the market share distribution will happen right after the MLC gets redesigned to operate for another five years at the punchbowl. Why? Because when the market share distribution happens it very likely will tip off an aggressive no-shit backlash against the MLC that would likely argue they can’t be trusted with much of anything at all.

It’s entirely possible that if the MLC has been this secretive about the amount of black box money in its grasp, the lobbyists never came clean with Congress about just how much the services were paying for their retroactive safe harbor in the form of undisclosed and unallocated monies. Remember the big scramble to deny a press report that the black box was over $1 billion? Maybe that press report wasn’t so far off after all.

Fortunately, there is a simple solution. Congress needs to take away any control or decision making about the unallocated black box money from the MLC. This could be as simple as a technical amendment forcing the MLC to act in a transparent manner and disclose the current investments of the black box money, any desposits and withdrawals, and to force distributions to occur when claimed by the correct owner.

The entire concept of a market share distribution should be eliminated from the Copyright Act because it creates a perverse incentive not to find the true owners by the people who benefit from the market share distribution. This moral hazard was obvious from the time the lobbyists drafted Title I of the Music Modernization Act and it should come as no surprise that it has failed miserably.

There’s no time like the present to fix it. Decisions about the black box should be taken away from the MLC and placed far, far outside if its orbit of the network of interlocking boards, consultants, accountants and companies surrounding the MLC and its confederates.