Consolidated Audit Trail Approved by the U.S. Securities and Exchange Commission

Mon 30 Jan 2017

The Securities and Exchange Commission (“SEC”) approved a plan on November 15, 2016, to create the consolidated audit trail (“CAT”), a central data source to collect and accurately identify every order, cancellation, modification and trade execution for all exchange-listed equities and options across all U.S. markets. This plan is pursuant to SEC Rule 613, in order to enhance the ability of regulators to analyze trading activity.

Currently, each self-regulatory organization uses its own separate audit trail system to track trade data in its respective markets, forcing regulators to accumulate large volumes of data from different entities in order to analyze market activity. In SEC press release 2016-240, Chair Mary Jo White stated that “through the CAT, regulators will have more timely access to a comprehensive set of trading data, enabling regulators to more efficiently and effectively conduct research, reconstruct market events, monitor market behavior, and identify and investigate misconduct.”

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