Welcome to SEC Roundup, a bimonthly video collection by Paul Hastings companions and former Securities and Change Fee senior trial counsels Nick Morgan and Tom Zaccaro exploring present SEC subjects with thought leaders and trade consultants.
On this episode, Morgan and Zaccaro discuss with Ken Bentsen, president and CEO of the Securities Trade and Monetary Markets Affiliation, and Ellen Greene, managing director, Fairness and Choices Market Construction at SIFMA, about the truth that, as of March 17, traders’ private identifiable data, or PII, turns into obtainable by way of the Consolidated Audit Path, referred to as the CAT, and what Bentsen and Greene say is the SEC’s failure to implement modifications to guard investor privateness.
CAT is the SEC-mandated central repository of trades, quotes and orders for all U.S. exchange-listed and over-the-counter fairness securities and U.S. exchange-listed choices contracts throughout all U.S. markets and buying and selling venues.
“The CAT was actually in response to the flash crash,” Bentsen notes, and ”can also be seen as an enforcement instrument” by the fee.
“We’ve had a number of issues over time” with the CAT, Bentsen relays. “Our members have all the duty however not one of the authority with respect” to the CAT. “We’ve got to report each single commerce to the Consolidated Audit Path; we’re in the end going to must pay for some portion of it … Most significantly, we’re turning over our shoppers’ delicate data — commerce information, some PII, and but as soon as we hand that information over, we lose all management over that information.”
Now, says Bentsen, the SEC must enact information privateness guidelines that have been pending since 2020.
The SEC in December introduced one of many first enforcement actions sourced from CAT — a $47 million front-running insider buying and selling case, SEC v. Billimek.