Consolidated Audit Trail (CAT) Compliance & CAIS Reporting: A Practical Guide for Broker-Dealers

 Regulatory reporting has become one of the most critical operational priorities for broker-dealers and capital market firms. With increasing scrutiny from regulators, Consolidated Audit Trail (CAT) Compliance, CAIS-Connect, and FINRA CAIS reporting are no longer optional they are essential for maintaining regulatory readiness, avoiding penalties, and ensuring transparent market activity.

This guide explains CAT and CAIS requirements in simple terms, highlights common challenges, and shows how modern compliance solutions can streamline reporting while reducing risk.



What Is Consolidated Audit Trail (CAT) Compliance?

The Consolidated Audit Trail (CAT) is a centralized system mandated by the SEC to track the entire lifecycle of equity and options orders in U.S. markets from order origination to execution and cancellation.

CAT compliance requires firms to:

  • Capture accurate order and trade data

  • Report events within strict timelines

  • Maintain data consistency across systems

  • Respond quickly to regulatory queries

Failure to meet CAT reporting standards can result in regulatory notices, fines, and reputational damage.

Key Challenges in CAT Reporting

Many firms struggle with CAT compliance due to:

  • Fragmented trading and order management systems

  • Data normalization and validation issues

  • High reporting volumes and tight deadlines

  • Frequent regulatory updates

Without automation, manual CAT reporting increases operational risk and compliance costs.

Understanding FINRA CAIS Reporting

FINRA CAIS (Customer and Account Information System) is designed to give regulators better visibility into customer and account-level data. Firms must submit accurate and timely information covering:

  • Customer identities

  • Account structures

  • Trading relationships

Errors or delays in FINRA CAIS submissions can trigger compliance flags and follow-up audits.

What Is CAIS-Connect and Why It Matters?

CAIS-Connect is a secure reporting framework that helps firms transmit customer and account data efficiently to FINRA. It simplifies data submission, validation, and reconciliation reducing manual effort and compliance risk.

Benefits of CAIS-Connect include:

  • Automated data mapping and validation

  • Reduced reporting errors

  • Faster regulatory submissions

  • Improved audit readiness

See CAIS-Connect in action

How Integrated CAT & CAIS Solutions Improve Compliance

Using disconnected tools for CAT and CAIS reporting often leads to duplication and inconsistencies. An integrated compliance approach enables firms to:

  • Centralize regulatory data

  • Automate reporting workflows

  • Maintain consistent audit trails

  • Adapt quickly to rule changes

This not only improves compliance accuracy but also lowers long-term operational costs.

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