July 11, 2024


Just in case you missed what the CAT is, it's a database, off in the cosmos, that collects intimate details of every trade, every day, including the investors Personal Identifiable Information ("PII"); everything including SS numbers.

When it became evident that the original CAT contractor couldn’t meet the development schedule, the job was bestowed upon FINRA to pick up the slack and get the CAT back on track.

Costs for the CAT are mounting up and may soon challenge the 39 decimal places of pi, far from the annual operating cost estimate of $51 million.  This year, the CAT LLC published a budget of $223 million.  Might it be on its way to billions when it's fully operational?

So, who’s going to bear the burden of the monstrously over-estimate price tag and growing?  You guessed it, ultimately the investor.  It’s going to be difficult for the SEC to rationalize who pays for what and how much, especially in light of Regulation Best Interest (“Reg BI”).  Don’t forget, we’re all “fiduciaries” now.  How do we explain another fee to our clients because you know they’re ultimately going to be paying for the CAT?

Let's put the cost aside for a moment.  What troubles me most, with all the ballyhoo about protecting “PRIVACY,” the agencies who pretend to be our “protectors of privacy” are the ones rushing to collect more PII than ever before.  I just don’t get it! 

What I also don’t understand is with all of our PII that’s floating around the internet and with various and sundry credit card companies and “list aggregators,” not to mention all the governmental agencies, why the push to create another database that has the potential to expose more about us?  Why not just go the NSA (National Security Agency) and buy their list?  We’re all on it…

I point you to this critique by SEC Commissioner Hester M. Peirce,
SEC Commissioner Criticizes Funding for Consolidated Audit Trailand a current article, published in Law|Street, and you'll get a better understanding of what I'm talking about.

Stephen Kohn, Chair

Financial Professionals Coalition, Ltd. 

A Clearinghouse of Solutions for Financial Professionals

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