Consolidated Audit Trail Implementation
On March 16, 2020 the SEC announced no-action relief to allow Participants to delay implementation of Consolidated Audit Trail (CAT) until May 20, 2020. This announcement comes as the industry deals with disruptions as a result of COVID-19, and members must make difficult prioritization decisions around staff required to implement CAT. The Operating Committee of the CAT NMS Plan has issued a Statement on the SEC’s No Action Letter. Participants and SRO’s have submitted a plea to adopt a new timeline.
This is an excellent opportunity for firms to shift their focus to test the validity of the data being reported, looking beyond syntax checks, and to perform more data comparisons to the source data file used to generate CAT reporting events. We are recommending that our clients continue to prepare for the implementation of CAT as internal resources allow.
The Time To Act Is Now
Some firms who have multiple CAT reporting agents are considering the use of a consolidation service to report for them or assist with oversight and testing. Regardless of the individual reporting methods, all Industry members are encouraged to take advantage of this testing window, and many will need this time to prepare for the Production Readiness Certification required to gain access to the CAT reporting environment before April 6th, if your firm is not electing to use the exemptive relief. If your firm is choosing to use the exemptive relief, you must submit for certification by May 6th. We are recommending that our clients continue to prepare for the implementation of CAT as internal resources allow.
Oyster can help you assess how your firm is positioned for CAT readiness, manage your requirements assessment and implementation phases, interface with your own technology providers, and assist you in determining what and how your technology providers will report for you. We can also assist in testing data scenarios and data linkage, as well as creating an error repair process. Firms can also leverage Oyster testing tools to gather and analyze reported data and errors.
CAT Implementation Delayed Due to COVID 19 – March 19, 2020
Consolidated Audit Trail (CAT) January 2020 Update – January 28, 2020
Consolidated Audit Trail (CAT) – Will Your Firm Be Ready To Report? – October 1, 2019