On November 30, 2020, Better Markets filed a comment letter on amendments proposed by the SEC to the national market system plan governing the consolidated audit trail (CAT). This proposal is a step toward implementing the CAT, and if finalized, would strengthen the cybersecurity of the CAT, protecting investors’ data and the integrity of the system.

If properly implemented the CAT, which is a database of trading and market data, would be a game-changer for the SEC and revolutionize the Commission’s capabilities to protect investors, facilitate capital formation and promote fair and orderly capital markets. Unfortunately, the SEC delayed and undermined the CAT by constantly bending over backward to accommodate the unending demands of the industry that CAT is supposed to police.

While we support this proposal, we call on the SEC to make additional changes to the CAT to make it the maximally impactful regulatory tool Congress intended it to be. The CAT’s current lack of real-time reporting, omission of futures data, and for-profit industry controlled governance structure fundamentally comprise its effectiveness. Until these structural factors are changed, the SEC will be frustrated in its attempts to properly investigate market disruption and protect investors from predatory practices.

Read our full comment letter here, or by clicking the buttong below.