From: AutomatedTrader.com
IFMA makes known significant concerns with the FINRA’s Comprehensive Automated Risk Data System proposal.
New York – SIFMA has submitted a comment letter to the Financial Industry Regulatory Authority (FINRA) expressing significant concerns with FINRA’s proposal for the development of a Comprehensive Automated Risk Data System (CARDS). The letter includes two new studies commissioned by SIFMA that estimate the significant costs and cybersecurity risks posed by CARDS, as proposed. SIFMA concludes that FINRA’s CARDS proposal would impose undue costs and burdens on member firms far exceeding any benefit and does not appropriately account for the impact on investor privacy and cybersecurity risk, and therefore should not be filed with the Securities and Exchange Commission (SEC). Further, CARDS, as proposed, would be duplicative to existing investor protection systems and processes.
“FINRA has an important investor protection mission and should have the tools it needs to do its job. CARDS, as proposed, is not necessary for that mission,” said Kenneth E. Bentsen, Jr., SIFMA president and CEO. “CARDS would infringe upon investors’ right to privacy by mandating that brokerage firms turn over to FINRA all individual account information on a monthly basis. This would result in the creation of a centralized database of all individual brokerage accounts, updated monthly and held by a quasi-governmental entity. This centralized individual account database would become a prime target for cyber attackers, be costly to build and maintain, and would produce more false positives that would drain resources that could be put to better use to help investors.”
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