Key facts
- The SEC plans to take direct control of the Consolidated Audit Trail (CAT) database.
- The CAT database is used to identify illicit activities in U.S. financial markets.
- SEC Chairman Paul Atkins communicated these plans in a letter to the CAT NMS plan operating committee chair.
- The SEC's move would shift oversight of the CAT from FINRA to the SEC.
The U.S. Securities and Exchange Commission (SEC) is preparing to assume direct control of the Consolidated Audit Trail (CAT), a comprehensive database used for monitoring U.S. financial markets and identifying misconduct. SEC Chairman Paul Atkins recently communicated his intentions in a letter to Robert Walley, the chair of the CAT NMS plan operating committee.
Atkins has instructed SEC staff to develop a plan for the agency to take over the CAT. This move would effectively usurp the market surveillance apparatus currently overseen by FINRA, the Financial Industry Regulatory Authority. The CAT database collects extensive trade information, serving as a critical tool for regulators to detect and investigate market manipulation and other illicit activities.