SIFMA submitted a comment letter criticizing proposed amendments to the National Market System Plan Governing the Consolidated Audit Trail ("CAT"), which, among other things, provides for liability to industry members reporting to the CAT relating to system breaches or misuse.
SIFMA stated that the limitation of liability would "force" industry members to "absorb contractually all of the risk associated with meeting their regulatory requirements," and "entirely excuse" CAT LLC and the self-regulatory organizations, which control and manage CAT data. SIFMA outlined its view that the proposal is (i) inconsistent with good public policy and industry standards, (ii) unnecessary for the financial stability of the CAT, and (iii) burdensome to industry members who would effectively have to pay for overlapping insurance policies regarding the same "core risks relating to CAT data security."
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