WASHINGTON, D.C.—Benjamin Schiffrin, Director of Securities Policy for Better Markets, issued the following statement in connection with Better Markets’ new Fact Sheet, “The SEC Must Not Kill The CAT”:

“The SEC’s rule requiring a consolidated audit trail (CAT), which makes our securities markets safer, became effective 13 years ago today. Although it subsequently took much longer than it should have to build the CAT, the CAT has proven its worth. The SEC has been able to identify misconduct that it would not have been able to uncover without the CAT.

“The industry has long opposed the CAT, and it now has an ally in new SEC Chair Paul Atkins. Chair Atkins has called for a comprehensive review of the CAT. Yesterday, he issued an order eliminating some of the CAT’s requirements and promising more changes.

“A potential dismantling of the CAT appears imminent and would be a mistake. Without the CAT, it will be harder for the SEC to oversee the securities market and easier for firms to break the law. The only parties who stand to benefit are those who would rather conceal their activities in the securities markets. The CAT’s advantages are numerous:

• The CAT enables the SEC to oversee our incredibly complex securities markets, with 26 securities exchanges, 109 alternative trading systems, and 3,300 broker-dealers.
• The CAT allows the SEC to protect investors from not only events like the Flash Crash of 2010, but also predatory trading activities and other types of misconduct.
• The CAT provides the SEC with the ability to monitor complicated trading strategies, so it can thwart efforts by high frequency traders to skirt regulatory scrutiny.

“In any review of the CAT, the SEC should side with the investors whom the CAT is designed to protect and not the firms whom the CAT is designed to police.”

The fact sheet is available online here.

###

Better Markets is a non-profit, non-partisan, and independent organization founded in the wake of the 2008 financial crisis to promote the public interest in the financial markets, support the financial reform of Wall Street and make our financial system work for all Americans again. Better Markets works with allies—including many in finance—to promote pro-market, pro-business and pro-growth policies that help build a stronger, safer financial system that protects and promotes Americans’ jobs, savings, retirements and more. To learn more, visit www.bettermarkets.org.