Deloitte has partnered with AccessFintech to create a solution for the upcoming Consolidation Audit Trail (CAT) regulation, integrating it into clients’ infrastructure. AccessFintech’s CAT Error Resolution workflow aims to improve data transparency and collaboration capabilities. The solution uses the company’s Synergy Network, allowing clients to aggregate, normalise and pair FINRA and transaction reporting data both within and between institutions. This allows for discrepancies and errors to be investigated and resolved, and manages reporting and error reconciliation for CAT submission. CAT regulation, which goes live in December 2022, requires companies to reach an initial (T+1) reporting accuracy rate of 95 per cent, and a 98 per cent reporting accuracy rate upon repair at a T+3 level. Clear remediation timeframes must be implemented, and personal identifiable information disclosed. This regulation will place significant pressure on resources without proper preparation and technology, AccessFintech says. Not meeting these requirements could also result in cash penalties. Boaz Zilberman, executive vice president of business development at AccessFintech, says: “CAT will create the single largest retail and institutional trading database. It will require a mammoth effort from financial institutions to manage, maintain, reconcile, and report millions of transactions per day. We are working with Deloitte to help clients ready themselves for what promises to be one of the most time-consuming, and — if not managed well — expensive, obligations in a quickly evolving regulatory landscape.” Commenting on CAT regulation, Bob Walley, principal of Deloitte & Touche, adds: “Banks and broker dealers need to modernise their non-financial regulatory reporting (NFRR) program to comply with regulatory obligations. Their efforts are often encumbered with legacy technology stacks and limited workflow enablers within their organizations. On top of this challenge, firms may find themselves having to manage millions of errors and rejected transactions, with limited capacity to resolve issues within CAT’s error correction timeframes. The operational costs of NFRR are escalating, alongside significant reputational and compliance risks.”
