WASHINGTON, April 16 - The U.S. Securities and Exchange Commission on Thursday said it will solicit public comment on whether a full review of the Consolidated Audit Trail, commonly known as the CAT, is warranted. The request for feedback invites views on a broad range of topics including how the CAT is financed, its stated purpose, organizational structure, governance, technical design, operational scope and cybersecurity protections.
Established by SEC mandate in 2012 following the so-called flash crash of 2010, the CAT was created to give regulators a consolidated record of orders and trades across U.S. markets. Regulators have said the database helps them detect market manipulation and have used its information in enforcement actions. Supporters argue those capabilities reinforce market oversight.
Nevertheless, the CAT has been embroiled in controversy since its inception. The project has faced repeated delays and legal challenges. Industry critics - notably some broker-dealers - contend the effort is excessively burdensome and expensive, and have raised concerns that storing detailed trading and customer data in a central repository increases the risk that sensitive personal information could be compromised by cybersecurity failures or attacks.
The SEC's announcement lists the specific areas where it seeks comment, and it includes cybersecurity concerns among the issues to be examined. By opening this review, the agency may provide renewed opportunity for opponents of the CAT to press objections that could influence the program's future, including potential actions to slow or halt aspects of the project.
The agency's outreach signals a willingness to revisit the design and governance choices made when the CAT was first mandated. At the same time, officials have pointed to the database's role in identifying problematic trading patterns and supporting enforcement work.
As the process unfolds, stakeholders will have the chance to weigh in on a range of technical, governance and policy questions. The SEC's request for comment sets the stage for a renewed public debate over whether the CAT, as currently constituted, best serves regulatory goals while protecting market participants and their data.