SEC Proposes Transparency And Financial Accountability Amendments To The CAT NMS Plan
The Securities and Exchange Commission voted to propose amendments to the national market system plan governing the Consolidated Audit Trail (the “CAT NMS Plan”).
The proposed amendments to the CAT NMS Plan would require self-regulatory organizations that are participants to the CAT NMS Plan (the “Participants”) to file with the Commission and publish a complete implementation plan for the Consolidated Audit Trail (“CAT”) and quarterly progress reports, each of which must be approved by the Operating Committee established by the CAT NMS Plan and submitted to the CEO, President, or equivalently situated senior officer at each Participant. In addition, the proposed amendments would include financial accountability provisions that establish target deadlines for four implementation milestones and reduce the amount of fee recovery available to the Participants if those target deadlines are missed.
“CAT needs to be implemented without further delays,” said SEC Chairman Jay Clayton. “The proposed amendments are designed to bring greater transparency and accountability to the implementation of the CAT.”
The public comment period will remain open for 45 days following publication of the proposing release in the Federal Register.
Today, the Commission voted to propose amendments to the CAT NMS Plan that are designed to decrease the likelihood of additional delays to CAT implementation by increasing operational transparency and attaching financial accountability to the Participants’ regulatory obligation to implement the CAT in an efficient and expeditious manner.
Operational Transparency Amendments
Financial Accountability Amendments
The proposed amendments establish target deadlines for four critical implementation milestones defined in the proposal, based largely on dates previously published by the SROs:
If the Participants do not meet these target deadlines, the amount of CAT funding that they can recover from Industry Members will be reduced at regular intervals.
The Commission will seek public comment on the proposed amendments for 45 days following publication of the proposing release in the Federal Register.