The Securities and Exchange Commission (SEC) is illegally collecting data of every citizen who invests in the stock market, according to a new lawsuit.
The New Civil Liberties Alliance (NCLA) filed the suit Tuesday against the SEC claiming that the agency, through its “Consolidated Audit Trail,” or “CAT,” program, is collecting mass amounts of personally identifiable data by forcing brokers, exchanges, clearing agencies and alternative trading systems to capture and send detailed information on every investor’s trades in U.S. markets to a centralized database.
The agency is doing so, NCLA says, without authorization from Congress and in violation of the Fourth Amendment, which prohibits unreasonable government search and seizure of private information.
Conceived during the Obama administration with bipartisan support within the Commission, the CAT program is a multibillion-dollar, self-appropriated fund, powered by various fees the SEC has collected through investment transactions, NCLA says. The group calls it “completely unlawful” and says it puts Americans’ financial data at “grave risk.”
“By seizing all financial data from all Americans who trade in the American exchanges, SEC arrogates surveillance powers and appropriates billions of dollars without a shred of Congressional authority — all while putting Americans’ savings and investments at grave and perpetual risk,” said Peggy Little, NCLA senior litigation counsel.
“The Founders provided rock-solid protections in our Constitution to prevent just these autocratic and dangerous actions. This CAT must be ripped out, root and branch,” she said…