U.S. Senators Katie Britt, Tom Cotton, Colleagues to Gensler: Protect Americans’ Privacy and Halt CAT Filings

WASHINGTON, D.C., September 20, 2024 — U.S. Senators Katie Britt (R-Ala.), Tom Cotton (R-Ark.), and 12 of their Congressional Republican colleagues today sent a bicameral letter to Securities and Exchange Commission (SEC) Chair Gary Gensler calling for the immediate suspension of the recently effective rule filings tied to the Consolidated Audit Trail (CAT).

The letter warns that the SEC’s decision to allow these fillings to proceed without proper oversight is an affront to investors and endangers the impartiality of the judicial process.

“As members of Congress and Amici Curiae in these cases, we have a vested interest in ensuring that the Commission adheres to its statutory authority. The CAT poses profound risks to Americans’ individual liberty and personal privacy. Moreover, if a significant new tax is levied on American investors, the Courts must be afforded an opportunity to conduct a fair and impartial review,” the lawmakers wrote.

Senators Tim Scott (R-S.C.), John Boozman (R-Ark.), Kevin Cramer (R-N.D.), Pete Ricketts (R-Neb.), Steve Daines (R-Mont.), Jerry Moran (R-Kan.), Bill Hagerty (R-Tenn.), and John Kennedy (R-La.) and Representatives French Hill (R-AR-02), John Rose (TR-TN-06), Steve Womack (R-AR-03), and Alex Mooney (R-WV-02) also co-signed the letter. 

Last October, Senators Britt and Kennedy sent a letter to Gene Dodaro, the Comptroller General, requesting that the Government Accountability Office (GAO) investigate the potential risks, constitutional issues, and privacy concerns raised by the SEC’s Consolidated Audit Trail (CAT).

The full text of the new letter can be found here and below:

Chair Gensler,

We write to express our concerns that the Securities and Exchange Commission (the “Commission”) has not suspended the most recent immediately effective rule filings to establish fees related to the Consolidated Audit Trail (“CAT”). As you are aware, the legality of the funding model underpinning these filings as well as the CAT itself are being reviewed in the Fifth and Eleventh Circuit Court of Appeals.’

As members of Congress and Amici Curiae in these cases, we have a vested interest in ensuring that the Commission adheres to its statutory authority. The CAT poses profound risks to Americans’ individual liberty and personal privacy. Moreover, fi a significant new tax is levied on American investors, the Courts must be afforded an opportunity to conduct a fair and impartial review.

The Commission has allowed the withdrawal of suspended fee filings, followed by the refiling of nearly identical ones, which effectively overrides its previous suspension and enables the immediate imposition of CAT fees with minimal notice to the industry. The Commission must suspend the CAT fees in order to allow market participants the opportunity to comment on these filings and to allow the legality of the entire CAT structure to be reviewed through the judicial process.

Thank you for your prompt attention to this matter.

Sincerely,

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