SEC Cuts Costs on Controversial Market Surveillance System
The SEC announced cost reductions for a market surveillance system meeting significant backlash. Following a court ruling that invalidated its 2023 funding model, the SEC's decision will decrease operating expenses by $25 million to $27 million, focusing on reducing system costs and enhancing its efficiency.
The U.S. Securities and Exchange Commission announced on Tuesday that it would allow stock exchanges to significantly lower costs associated with a market surveillance system, addressing strong opposition from conservatives and the industry.
This development comes after a court recently invalidated the funding model established under former President Joe Biden in 2023. The SEC highlighted that due to the changes introduced, operating expenses for the system in 2025 will be reduced by $25 million to $27 million compared to previous estimations.
The CAT, which was created by the SEC following the 2010 'flash crash' to monitor market behavior, will undergo evaluation concerning its effectiveness. The decision also follows a federal court's decision that criticized the agency for not justifying its cost-sharing approach among market participants.
(With inputs from agencies.)
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