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, standardize and link FINRA and transaction reporting data both within and across institutions. This allows discrepancies and errors to be investigated and resolved, and to manage error reporting and reconciliation for the CAT submission.
The CAT regulations, which will come into effect in December 2022, require companies to achieve an initial (T+1) reporting accuracy rate of 95% and a reporting accuracy rate of 98% when repairing to a level T+3. Clear remedy timelines should be in place and personally identifiable information should be disclosed.
This regulation will put a significant strain on resources without proper preparation and technology, says AccessFintech. Failure to comply with these requirements could also result in cash penalties.
Boaz Zilberman, Executive Vice President of Business Development at AccessFintech, said, “CAT will create the largest retail and institutional database. This will require a colossal effort from financial institutions to manage, maintain, reconcile and report millions of transactions per day.
We work with Deloitte to help clients prepare for what promises to be one of the most time-consuming and, if not well-managed, costliest obligations in a rapidly changing regulatory landscape.
Commenting on the CAT regulations, Bob Walley, Director of Deloitte & Touche, adds: “Banks and broker-dealers need to modernize their non-financial regulatory reporting (NFRR) program to comply with regulatory obligations. Their efforts are often hampered by legacy technology stacks and limited workflow enablers within their organizations. Compounding this challenge, businesses may be dealing with millions of errors and rejected transactions, with limited ability to resolve issues within CAT’s error correction timelines. NFRR’s operational costs are rising, along with significant reputational and compliance risks.