SIFMA Submits Comments on FINRA Proposal to Amend OATS

SIFMA submitted comments to FINRA regarding a proposal to amend the Order Audit Trail System ("OATS") rules. The proposed rules require members to identify non-member broker-dealers when reporting orders received by them and requires Alternative Trading Systems ("ATSs") to provide FINRA with order book information using additional OATS interfaces.

SIFMA stated that it supports FINRA's goal: to enhance the automated surveillance and monitoring of trading activity on ATSs. However, according to SIFMA, the data collection requirements of the proposal would not serve FINRA's goal "because the requirements do not sufficiently account for the unique and customized trading functionalities that each ATS provides."

SIFMA explained that the proposed data collection requirements "would impose unworkable operational burdens and FINRA has not sufficiently explained how this additional information would enhance its surveillance efforts." For that reason, SIFMA urged FINRA to work directly with both it and its members in order to refine the proposal to provide FINRA with workable data elements that would not impose unnecessarily excessive costs or risks.

See: SIFMA Comment Letter.Related news: FINRA Requests Comment on Equity Market Disclosure Proposals (FINRA Reg. Notice 14-51) (November 17, 2014).