SEC Chairman Jay Clayton late Tuesday rejected a last-minute attempt by stock exchanges to delay the implementation of the consolidated audit trail.
The first phase of CAT, which would collect information on all U.S. equity and options trades, scheduled to start Wednesday. This phase requires exchanges to report on trades executed on their markets.
On Monday, U.S. equity exchange officials, in a letter to the Securities and Exchange Commission, asked for a one-year delay in implementing CAT, Mr. Clayton said in a news release. He said the officials wrote they were not prepared to meet Wednesday's start date and also were concerned about cybersecurity at the SEC.
"I recognize that recently the (exchanges) have worked together to develop an action plan for bringing the CAT online, albeit on a delayed basis," Mr. Clayton said in the release. "Further, it is clear that the (exchanges') increased engagement with the SEC in recent days has been constructive. However, I am not in a position to support the issuance of the requested relief on the terms currently proposed."
Mr. Clayton said he reassured the exchanges that "protection of the information submitted to the CAT is of paramount importance and that I am open to various paths for addressing cybersecurity matters. Additionally, I have made it clear that the SEC will not retrieve sensitive information from the CAT unless we believe appropriate protections are in place."