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Regulation and Compliance > Federal Regulation > FINRA

FINRA, Exchanges Prep for CAT Compliance Date

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Twenty-two self-regulatory organizations including the Financial Industry Regulatory Authority are gearing up to comply with the Nov. 15 Consolidated Audit Trail, or CAT, compliance date.

CAT, created under Securities and Exchange Commission Rule 613 of Regulation NMS, “was really intended to promote the ability of regulators to have a consolidated view of the markets,” Robert Cook, president and CEO of the Financial Industry Regulatory Authority, said on Nov. 1 at the 2018 Financial Markets Quality Conference at Georgetown University in Washington.

CAT requires FINRA and the national securities exchanges to develop and submit to the SEC a plan to create, implement and maintain CAT, which would track market trading activity.

“The CAT process is continuing,” Cook stated. “It’s a complicated project that’s a year behind schedule,” with the first phase coming up on Nov. 15 “really the first phase of reporting into the CAT by the exchanges.”

The subsequent phase will involve reporting by the broker-dealer industry into the CAT in November 2019.

FINRA has “been very supportive of CAT all along,” Cook stated at the event.

Beyond making reporting mandatory for everybody on the exchange, the CAT also will provide new information on options, Cook stated, as well as the controversial “beneficial owner” information.

Beneficial owner information under CAT would provide “information about everyone who has a securities account,” Cook explained. “There’s been concerns expressed about collecting that information, the security of it. There’s lots of conversations about what’s the right path forward.”

— Check out FINRA, Exchanges Set New CAT Schedule After Missing Deadline on ThinkAdvisor.


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