In 2017 the Securities and Exchange Commission (SEC) directed the national securities exchanges and the Financial Industry Regulator Authority to develop, implement, and maintain a consolidated audit trail (CAT). The CAT is intended to enable regulators to better oversee securities markets. H.R. 4785 would prohibit the CAT from accepting personally identifying information except in connection with large traders.
Using information from the SEC, CBO estimates that implementing H.R. 4785 would cost less than $500,000 over the 2019-2023 period for the SEC to amend the CAT plan to implement the bill’s requirements. However, the SEC is authorized to collect fees sufficient to offset its annual appropriation; therefore, CBO estimates that the net effect on discretionary spending would be negligible, assuming appropriation actions consistent with that authority.
Enacting H.R. 4785 would not affect direct spending or revenues; therefore, pay-as-you-go procedures do not apply.
CBO estimates that enacting H.R. 4785 would not increase net direct spending or on-budget deficits in any of the four consecutive 10-year periods beginning in 2029.
H.R. 4785 contains no intergovernmental mandates as defined in the Unfunded Mandates Reform Act (UMRA).
If the SEC increases fees to offset the associated costs, H.R. 4785 would increase the cost of an existing mandate on private entities required to pay those fees. Using information from the SEC, CBO estimates that the incremental cost of the mandate would fall well below the annual threshold for private-sector mandates established in UMRA ($160 million in 2018, adjusted annually for inflation).
