SEC Probes Audit Trails: Tech, Privacy, and Market Fairness
Published Date: 4/20/2026
Proposed Rule
Summary
The SEC wants your thoughts on how it tracks stock market trades using the Consolidated Audit Trail and other data tools. They’re thinking about updating rules to keep up with new tech, privacy, and security needs, and to make sure the system is fair and cost-effective. If you’re involved in the stock market or data tracking, speak up by June 22, 2026!
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Analyzed Economic Effects
4 provisions identified: 1 benefits, 1 costs, 2 mixed.
CAT costs and possible fee changes
The SEC notes CAT operating costs rose from an estimated $55.8 million (2016) to over $248 million in the SROs' 2025 budget, and the SROs approved a roughly $156 million budget for 2026. The Commission is asking for comments on funding mechanisms, cost management, allocation of fees, use of Section 31 fees, reserve funds, and alternative funding methods for the CAT.
CAT stops holding customer PII
On January 13, 2026, the SEC approved an order (the CAIS Order) that enables the SROs and the CAT to eliminate collection and retention of many kinds of personally-identifying information (for example, names, addresses, years of birth, SSNs, ITINs, and account numbers). If you have a brokerage account, that kind of personal account-level data is no longer required to be stored in the CAT.
Regulators can still link trades to customers
Even though the CAT no longer must collect many customer identifiers, the CAT's identifier architecture can generate a CAT Customer ID (CCID) and regulators may still associate trading records with a customer's account if they separately obtain account-level information (for example, via the EBS system or manual requests). If you have an investment account, regulators can link your trading activity to your account if they obtain your account data from brokers.
Large trader reporting and LTID rules
Rule 13h-1 requires large traders to identify themselves on Form 13H and for the Commission to issue a Large Trader Identification (LTID). The rule defines identifying activity levels as at least 2 million shares or $20 million fair market value in a calendar day, or 20 million shares or $200 million fair market value in a calendar month; EBS is used to request account-level transactional data for large traders and Unidentified Large Traders.
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