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ASA Commends Senators Kennedy & Britt Urging GAO Review of CAT in Light of Investor Privacy Concerns

WASHINGTON, D.C. – The American Securities Association (ASA) applauded U.S. Senators John Kennedy (R-LA) and Katie Britt (R-AL), members of the U.S. Senate Banking, Housing, and Urban Affairs Committee, for sending a letter to the Government Accountability Office (GAO) requesting an investigation and report regarding the U.S. Securities and Exchange Commission’s (SEC) proposal to enact new mandates related to cybersecurity policies and procedures for broker-dealers and the Consolidated Audit Trail’s (CAT) collection of retail investor personal and financial data. ASA has been at the forefront of advocacy to industry and Members of Congress, including the letter, to remove retail investor personally identifiable information (PII) from the CAT.

“Since the CAT was adopted, market participants, SEC commissioners, and Members of Congress have continued to raise concerns about its collection of personal and financial information of every American investor. Not only does the collection of this data by a nationwide database violate the right to privacy of American investor, but it also needlessly creates a bullseye on the database for cybercriminals and hackers in Russia and China,” said ASA President and CEO Chris Iacovella.

The Senators echoed that concern writing, “Even more concerning, the CAT poses fundamental threats to protections from ‘unreasonable search and seizures’ under the Fourth Amendment. The courts have previously held that the mandated production of certain information can violate the Fourth Amendment. There are many legitimate reasons an individual would not want their financial transactions to be regularly submitted to a government registry. The SEC has failed to appreciate and address these concerns that CAT collection of PII presents.”

In September, ASA Board Members Warren Stephens, CEO & President of Stephens, and Paul C. Reilly, CEO & Chairman of Raymond James, published an op-ed in The Wall Street Journal expressing concerns about the SEC’s collection of American investors’ financial and personal identifiable information on the CAT.

In August, ASA applauded eight state attorneys general, led by Arkansas Attorney General Tim Griffin, for sending a letter urging leaders in the United States Congress to support legislation to protect investors’ privacy.

In June, ASA supported members of the U.S. House Committee on Financial Services, including Representatives Barry Loudermilk (R-GA), Ann Wagner (R-MO), French Hill (R-AR), Frank Lucas (R-OK), Bill Huizenga (R-MI), and Zach Nunn (R-IA) for sending a letter to the SEC outlining the privacy and security risks the CAT’s collection of PII posed to American investors.

Senator Kennedy and Senator Britt’s letter can be found here.


About the American Securities Association

American Securities Association, based in Washington, DC, represents the retail and institutional capital markets interests of regional financial services firms who provide Main Street businesses with access to capital and advise hardworking Americans how to create and preserve wealth. ASA’s mission is to promote trust and confidence among investors, facilitate capital formation, and support efficient and competitively balanced capital markets. This mission advances financial independence, stimulates job creation, and increases prosperity. The ASA has a geographically diverse membership of almost one hundred members that spans the Heartland, Southwest, Southeast, Atlantic, and Pacific Northwest regions of the United States.


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