22nd April 2020 – London, UK – The Consolidated Audit Trial (CAT) timeline for broker-dealers reporting equity and options trades in the US has been delayed once again due to the Coronavirus pandemic sweeping the globe.
Broker-dealers, who were originally due to submit reports for equities to the FINRA Order Audit Trail System on 20th April, were notified last month of an initial delay until Mid-May in a ‘no-action’ letter published by the US Securities and Exchange Commission (SEC). However, this latest notice now pushes that deadline back further and extends the reporting deadline to 22nd June, 2020.
The SEC released a statement on Monday, notifying broker-dealers of the adjustment to the rules following their decision to vote in favour of two exemptive orders. The exemptive orders were issued to allow broker-dealers to focus on business stabilisation during the current COVID-19 crisis, It said “in order to address the impact of COVID-19 while preserving progress toward existing milestones, the first exemptive order also allows for a delayed start to CAT reporting conditioned upon compliance with certain other obligations. These obligations include milestones related to testing and releases of CAT functionality, as well as all other compliance dates for broker-dealer reporting to the CAT.” It went on, “the second order provides exemptive relief permitting these firms to follow the CAT reporting timeline applicable to small broker-dealers.”
This latest notice means that whilst the system is live, broker-dealers are not actually required to report until the June deadline. The notice means the following deadlines are now in place:
- June 22, 2020: Initial equities reporting for large broker-dealers and small broker-dealers that currently report to FINRA’s Order Audit Trail System (OATS);
- July 20, 2020: Initial options reporting for large broker-dealers; and
- Dec. 13, 2021: Full equities and options reporting for large and small broker-dealers; and
- July 11, 2022: Full customer and account reporting for large and small broker-dealers.
The CAT is set to provide and improve transparency and trace-ability in the securities market. Once fully functioning, it will be the world’s largest data repository of information on securities transactions, tracking all orders throughout their life cycle, according to the operating committee for the CAT.
Inforalgo are offering free CAT consultations, if you’d like to talk to regulatory reporting experts today or find out more about it’s dedicated cloud-based FINRA CAT solution, RegFlex, you can do so here.