SEC\u2019s 15-year saga<\/a> to firmly establish an up-to-date market monitoring system to help regulators keep watch over today\u2019s algorithmically enhanced, high-speed financial markets. (The impetus for the new system stemmed from the \u201cFlash Crash\u201d of May 2010, an out-of-the-blue, fleeting market plunge that left regulators baffled and unable to conclusively explain.) <\/p>\nImportantly, the 11th US Circuit Court of Appeals did not rule on the challengers\u2019 argument that the establishment of the CAT, itself, was an unlawful overstepping of the SEC\u2019s authority. <\/p>\n
The opinion said such a finding was unnecessary as the court agreed with other arguments that the funding rule \u2014 which leaned heavily on brokerages like Citadel to foot the bill from the system \u2014 was established without explaining or justifying a change that would have allowed the entirety of the cost of the project to be shifted to broker dealers. (A previous funding plan suggested that the costs of the monitoring system would be shared by both self-regulatory organizations, like FINRA, and broker dealers.) <\/p>\n
Though the decision was stayed for 60 days, meaning it won\u2019t yet be enforced, it raises questions about how such a large market monitoring system will be funded: the CAT cost roughly $500 million to build, and is expected to cost about $200 million a year to run, if not more. <\/p>\n
\u201cThe SEC should pay for it like other key regulatory tools,\u201d said Tyler Gellasch, CEO of the Healthy Markets Association, a nonprofit focused on increasing transparency and reducing conflicts of interest in capital markets. \u201cBut that also means Congress needs to authorize the SEC to collect enough money for the CAT to actually work.\u201d <\/p>\n
For more on the CAT, check out this previous story<\/a>. <\/p>\n","protected":false},"excerpt":{"rendered":"A federal appeals court ruled Friday that a Securities and Exchange Commission order on how to pay for…\n","protected":false},"author":2,"featured_media":37890,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[37],"tags":[28,112],"class_list":{"0":"post-37889","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-markets","8":"tag-business","9":"tag-markets"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts\/37889","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/comments?post=37889"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts\/37889\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/media\/37890"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/media?parent=37889"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/categories?post=37889"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/tags?post=37889"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}