Latest news with #ConsolidatedAuditTrail
Yahoo
16 hours ago
- Business
- Yahoo
NCLA's King George III Prize Crowns Former SEC Chair Gensler 2024's Worst Civil Liberties Violator
Washington, DC, June 11, 2025 (GLOBE NEWSWIRE) -- The Administrative State's biggest abuser of civil liberties in 2024 was former Securities and Exchange Commission Chair Gary Gensler! After weeks of online voting for the New Civil Liberties Alliance's Fifth Annual 'King George III Prize,' Gensler defeated 31 other rights-violating bureaucrats in a campaign on social media. The 'winner' was announced last night at an event in Washington, DC. Gensler earned the Prize in part for overseeing construction of SEC's 'Consolidated Audit Trail' ('CAT'), the largest government-mandated mass collection of personal financial data in American history. Without any statutory authority, SEC is forcing brokers, exchanges, clearinghouses and alternative trading systems to capture and send detailed information on every investor's trades in U.S. markets to a centralized database. NCLA is suing to stop the CAT in our Davidson, et al. v. Gensler lawsuit. Gensler also continued SEC's illegal 'Gag Rule' that forbids every American who settles a regulatory enforcement case with the agency from even truthfully criticizing their cases in public for the rest of their lives. NCLA's Powell, et al. v. SEC case aims to overturn the 'Gag Rule.' NCLA also presented the National Center for Public Policy Research with our George Washington Award for Client Bravery last night. NCLA represented NCPPR in the lawsuit against SEC that persuaded the U.S. Court of Appeals for the Fifth Circuit to overturn Nasdaq's 'Board Diversity Rules,' which sought to impose gender, race and sexual orientation quotas on corporate board membership for Nasdaq-listed companies. NCPPR is also a Plaintiff in Davidson v. Gensler and NCLA's client in our suit against unconstitutional SEC rules that would require public companies to disclose their climate-related business risks and mitigation procedures. NCLA honored Tim Harper and Marc Wheat of Advancing American Freedom with the George Washington Award for Best Amicus Curiae Brief, which they submitted in Davidson v. Gensler. Alexander J. Phipps of Antonin Scalia Law School took home the Student Note Award accompanied by a $10,000 prize to be split with the George Mason Law Review for his timely piece: 'Interpreting the APA's Triggering Provision for Formal Adjudication After Loper Bright.' It addresses implications of NCLA's historic overthrow of Chevron deference at the Supreme Court in Relentless, Inc. v. Dept. of Commerce and Loper Bright Enterprises v. Raimondo. NCLA released the following statements: 'For the fifth year, NCLA's King George III Prize highlights the true abusers of Americans' civil liberties—unelected bureaucrats. Former SEC Commissioner Gary Gensler is our newest 'winner' for overseeing one of the largest information grabs in our nation's history. His Consolidated Audit Trail program is something right out of George Orwell's 1984, with Big Brother tracking every stock market trade Americans make. Chair Gensler may have been unelected, but this award holds him accountable for violating the civil rights of millions of Americans.'— Karen Harned, Director of Engagement, NCLA 'This year's nominees for America's Worst Bureaucrat were a true rogues' gallery of civil liberties violators. But former SEC Chair Gary Gensler stood apart as most deserving of the ignominy the King George III Prize brings.'— Mark Chenoweth, President, NCLA ABOUT NCLA NCLA is a nonpartisan, nonprofit civil rights group founded by prominent legal scholar Philip Hamburger to protect constitutional freedoms from violations by the Administrative State. NCLA's public-interest litigation and other pro bono advocacy strive to tame the unlawful power of state and federal agencies and to foster a new civil liberties movement that will help restore Americans' fundamental rights. ### CONTACT: Joe Martyak New Civil Liberties Alliance 703-403-1111 in to access your portfolio
Yahoo
28-04-2025
- Business
- Yahoo
Insider Trader Gets Jail as SEC Reconsiders Tool That Caught Him
(Bloomberg) -- An Oregon retiree was ordered to spend a year behind bars for conspiring with a Nuveen LLC trader in a $47 million insider trading scheme — a case flagged by a controversial SEC tracking tool the Trump administration is considering reining in. Newsom Says California Is Now the World's Fourth-Biggest Economy At Bryn Mawr, a Monumental Plaza Traces the Steps of Black History US Cricket Deepens Bet on Texas With HQ Shift From California Los Angeles Downgraded to AA- by S&P Due to Budget Woes The Last Thing US Transit Agencies Should Do Now Alan Williams, 79, was sentenced Monday by a federal judge in Manhattan. Both he and the former Nuveen trader, Lawrence Billimek, pleaded guilty in 2023. Last May Billimek, 54, received a nearly six-year sentence for tipping off Williams to thousands of trades by Nuveen, a unit of TIAA that manages $1.3 trillion in assets. US District Judge Paul Gardephe noted that Williams had cooperated with the government against Billimek. The case was one of the first criminal cases brought based on data gathered by the Consolidated Audit Trail, a powerful database tracking as many as 500 billion trades a day that the Securities and Exchange Commission has been building for more than a decade. But Wall Street firms and Congressional Republicans have called for the CAT to be shut down, and new SEC Chairman Paul Atkins, who was sworn in last week, has also previously expressed doubts about it. Legal experts have said a scheme like Billimek and Williams' would not have been uncovered without CAT. Though major insider-trading cases have often focused on single-market events like merger announcements, the Nuveen one involved some 1,697 intraday equity trades made by Williams. The SEC found that he had a 97% 'win rate' over a five-year period, which had less than one-in-a-trillion odds of occurring randomly. But Citadel Securities LLC and the American Securities Association, a trade group representing regional financial institutions, sued the SEC over the CAT in 2023, claiming that the regulator can't operate such a tool without Congressional authorization. Citadel's suit received backing from Republican politicians, who've expressed concern that the CAT could be used to monitor investors' political and religious beliefs. With Donald Trump back in the White House, the debate over CAT is now within the SEC itself. Project 2025, the conservative manifesto for creating a more powerful Republican presidency, explicitly called for the database to be terminated. Atkins said during his confirmation hearing that the CAT needs to be reviewed, saying that the costs have 'ballooned' and that its mission 'has kind of veered off.' Even before Atkins' confirmation, the financial industry began lobbying the administration for changes to the database. The SEC has already exempted identifiable information such as names and birth years from being stored in the database. In February, the Securities Industry and Financial Markets Association, another Wall Street trade group, urged the SEC to pause fee collections from brokers related to the CAT. Along with the Nuveen case, the SEC has said the CAT was partly responsible for two other enforcement actions. A Federal Reserve bank examiner in November pleaded guilty to trading on confidential information about companies he supervised, and a Florida trader in December settled claims that he used 'spoof' orders to manipulate thinly-traded securities. 'Embarrassed and Ashamed' At his sentencing Monday, Williams apologized to the court, his family and Nuveen employees and clients. 'I'm embarrassed and ashamed,' he said. Williams faced as much as 75 years in prison, although white-collar criminals rarely receive the maximum penalty. Federal sentencing guidelines called for a punishment of 57 to 71 months behind bars. Billimek, who was responsible for routing orders based on Nuveen portfolio managers' decisions, admitted to tipping off Williams about Nuveen's planned trades in stocks, including Lululemon Athletica Inc. and Ulta Beauty Inc., as part of a complex plot that also involved the use of burner phones to hide their interactions from authorities. In one example provided by prosecutors, the scheme netted more than $55,000 in profits one day in August 2022 by shorting shares of Match Group Inc. ahead of substantial sales by Nuveen. Williams, a onetime head trader for Sutro & Co. in San Francisco, had asked Gardephe to keep him out of prison, calling himself an 'uncommonly decent and giving man' and noting that he suffers from advanced Parkinson's disease. The judge said a non-custodial sentence wasn't possible, given the 'blatant nature' of the conduct and the number of illegal trades. The case is US v Billimek, 22-cr-675, US District Court, Southern District of New York (Manhattan). As More Women Lift Weights, Gyms Might Never Be the Same Why US Men Think College Isn't Worth It Anymore Healthy Sodas Like Poppi, Olipop Are Drawing PepsiCo's and Coca-Cola's Attention Eight Charts Show Men Are Falling Behind, From Classrooms to Careers The Mastermind of the Yellowstone Universe Isn't Done Yet ©2025 Bloomberg L.P.
Yahoo
03-04-2025
- Business
- Yahoo
'Elevated' risk of data leak from SEC surveillance tool, watchdog says
By Douglas Gillison (Reuters) - A recent audit showed an "elevated" risk of a data leakage from the comprehensive market data surveillance system used by Wall Street's top regulator, according to a watchdog report made public this week. While the Office of Inspector General at the U.S. Securities and Exchange Commission said the agency had taken recent steps to address the problem, the findings may bolster criticism from Republicans and lobby groups, who say the so-called Consolidated Audit Trail (CAT) system threatens the security of private individuals' data. According to the audit report, during the review period the SEC did not take steps to detect and prevent data leakage or regularly ensure that users complied with data safeguards. Officials were unable to monitor and block emails containing CAT data, for example. Another of the audit's findings was redacted for security reasons. The SEC did not immediately respond to a request for comment but said in a written response published with the report that SEC data security was in transition during the audit period of January 2023 to August 2024. It said officials had since adopted enhanced security controls that exceed federal requirements. The SEC also accepted all of the report's recommended fixes. The Commission in February ended the requirement to supply users' names, addresses and years of birth into the CAT. The report's findings come as Elon Musk's Department of Government Efficiency, which has drawn Democrats' ire over its access to sensitive government data, is in the early stages of accessing SEC systems. SEC officials say this will be subject to conditions. In 2012, the SEC mandated the creation of the CAT as a response to the so-called "flash crash" of two years earlier, when a sudden plunge on major Wall Street indices temporarily erased nearly $1 trillion in market value. The CAT, which is operated by the Financial Industry Regulatory Authority, an industry-funded self-regulatory organization overseen by the SEC, began operating in phases starting in 2020. It contains transaction and customer data using anonymous identifiers and ID numbers. As of last year, more than 200 SEC staff members had access to it, according to the report. Officials have cited CAT data in the prosecution of an alleged $47 million front-running scheme, the exposure of alleged fraudulent trading and a review of the 2021 GameStop fiasco.
Reuters
03-04-2025
- Business
- Reuters
'Elevated' risk of data leak from SEC surveillance tool, watchdog says
April 3 (Reuters) - A recent audit showed an "elevated" risk of a data leakage from the comprehensive market data surveillance system used by Wall Street's top regulator, according to a watchdog report made public this week. While the Office of Inspector General at the U.S. Securities and Exchange Commission said the agency had taken recent steps to address the problem, the findings may bolster criticism from Republicans and lobby groups, who say the so-called Consolidated Audit Trail (CAT) system threatens the security of private individuals' data. According to the audit report, during the review period the SEC did not take steps to detect and prevent data leakage or regularly ensure that users complied with data safeguards. Officials were unable to monitor and block emails containing CAT data, for example. Another of the audit's findings was redacted for security reasons. The SEC did not immediately respond to a request for comment but said in a written response published with the report that SEC data security was in transition during the audit period of January 2023 to August 2024. It said officials had since adopted enhanced security controls that exceed federal requirements. The SEC also accepted all of the report's recommended fixes. The Commission in February ended the requirement to supply users' names, addresses and years of birth into the CAT. The report's findings come as Elon Musk's Department of Government Efficiency, which has drawn Democrats' ire over its access to sensitive government data, is in the early stages of accessing SEC systems. SEC officials say this will be subject to conditions. In 2012, the SEC mandated the creation of the CAT as a response to the so-called "flash crash" of two years earlier, when a sudden plunge on major Wall Street indices temporarily erased nearly $1 trillion in market value. The CAT, which is operated by the Financial Industry Regulatory Authority, an industry-funded self-regulatory organization overseen by the SEC, began operating in phases starting in 2020. It contains transaction and customer data using anonymous identifiers and ID numbers. As of last year, more than 200 SEC staff members had access to it, according to the report. Officials have cited CAT data in the prosecution of an alleged $47 million front-running scheme, the exposure of alleged fraudulent trading and a review of the 2021 GameStop fiasco.
The Hill
27-03-2025
- Business
- The Hill
Trump SEC pick takes heat from Democrats over recession, agency's future
Democrats pressed President Trump's pick to lead the Securities and Exchange Commission (SEC) on Thursday over his prior work at the agency in the lead up the 2008 financial crisis and his plans for the SEC's future. Former SEC Commissioner Paul Atkins appeared before the Senate Banking Committee alongside several other nominees who the president has tapped to take on roles at financial regulatory agencies. Sen. Elizabeth Warren (D-Mass.), the top Democrat on the panel, took aim at Atkins' track record at the SEC, where he served as a commissioner from 2002 to 2008. 'Mr. Atkins has an almost perfect track record,' Warren said. 'He got pretty much everything wrong in the run up to the biggest financial crash since the Great Depression. That is not a record that deserves promotion.' 'Your job was to spot and head off risks that were building up in financial markets, but you showed staggeringly bad judgment,' she added. Sen. Raphael Warnock (D-Ga.) also voiced concerns about Atkins' takeaways from the financial crisis, noting the SEC nominee suggested in a previous conversation that misguided regulation was partly to blame. 'There are communities in Atlanta, especially communities that I'm close to and folks that I know and people in my church that still haven't recovered,' Warnock said. 'I mean, we saw a huge transfer of wealth as a result of this crisis.' 'The banks got bailed out. Wall Street got bailed out, but consumers didn't get bailed out. And I'm asking because you are the nominee at the SEC, and I'm just trying to get an understanding of what you think we need to do differently.' Atkins argued that the SEC at the time was 'focusing on the wrong things' and was 'distracted by ancillary issues' rather than those that were important to the marketplace. Several Democrats also grilled Atkins about his contributions to Project 2025, a conservative blueprint for a second Trump administration created by the Heritage Foundation. Atkins is listed as a contributor and received a specific shoutout for a chapter on financial regulatory agencies, including the SEC. Sen. Chris Van Hollen (D-Md.) asked Atkins on Thursday whether he would commit to preserving the Public Company Accounting Oversight Board (PCAOB), which Project 2025 called to be abolished. The board was created by Congress in the early 2000s to oversee audits of public companies. Atkins sought to downplay his role in Project 2025, emphasizing that he only participated in a couple phone calls. When pressed whether he support abolishing the board, the SEC nominee deferred to Congress, saying, 'It's not in my power; it's up to you all.' 'The function needs to be done,' he added. 'Whether it's PCAOB or whether it's folded back into the SEC, the function is vital.' Atkins also faced questions from Sen. Andy Kim (D-N.J.) about Project 2025's call for the termination of the Consolidated Audit Trail (CAT) program, which aims to create a database that would allow regulators to track all trading activity across U.S. markets. 'I commit to looking at the situation the way it is now, what the plans are, how efficient it is, what the costs are going to be,' he said. 'They've ballooned a lot from what started out and even the mission of it has kind of veered off.' Trump's nominee is expected to draw a sharp contrast with Biden-era SEC chair Gary Gensler, who was widely disliked by Republicans and industry. 'You just have to be able to breathe and not be a complete raging lunatic, and you're gonna be the greatest SEC commissioner compared to last guy,' Sen. Bernie Moreno (R-Ohio) said. Most notably, Atkins is expected to take a much friendlier approach toward the crypto community — one that Senate Banking Chair Tim Scott (R-S.C.) emphasized will ensure 'American innovation does not fall further behind.' 'A top priority of my chairmanship will be to work with my fellow commissioners and Congress to provide a firm regulatory foundation for digital assets through a rational, coherent and principled approach,' Atkins said Thursday. He previously served as co-chair of the Digital Chamber's Token Alliance and was a member of the board of directors at Securitize, a tokenization platform. He has stepped down from both roles in recent months, according to a financial disclosure released Tuesday. As part of an ethics agreement, Atkins also plans to step down as CEO of financial services consultancy Patomak Global Partners and divest his membership interest in the firm. Financial records show that he has a net worth of at least $327 million, including a stake of at least $25 million in Patomak, according to Bloomberg.
