EXCLUSIVE: Nearly two dozen state financial officers sent a letter to House Speaker Mike Johnson, R-La., late Wednesday demanding he take up a bill prohibiting the Biden administration from implementing a program that tracks private investment transactions.
Twenty-three officials in 19 states crafted a letter that demands a bill from Rep. Barry Loudermilk, R-Ga., the Protecting Investors’ Personally Identifiable Information Act, be immediately acted upon.
Loudermilk’s bill, H.R. 4551, formally prohibits the SEC from requiring personally identifiable information to be collected under the SEC’s new program and “for other purposes.”
If the bill passes, the signatories argue it could stymie the Securities and Exchange Commission from continuing its implementation of changes to the Consolidated Audit Trail (CAT), a tracking mechanism for trading activity on the stock market.
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SEC Commissioner Hester Peirce, a Trump appointee, warned the CAT serves as a “comprehensive surveillance database that will collect and store every equity and option trade and quote from every account at every broker by every investor.”
The signatories warned in the letter of civil liberties concerns in that regard as well as the CAT’s “questionable legality.”
“We share the concerns of the American Securities Association … and numerous members of the House and Senate who … [have] expressed concern,” the letter states.
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They also said it may be against the law to establish such a database via federal rule versus an act of Congress.
The CAT’s collection of retail investors’ information “poses a clear threat to the security of every American investor,” the signatories argued, as a central database is also more susceptible to hackers.
State financial officers who signed the letter included Pennsylvania Treasurer Stacy Garrity, who is up for re-election this fall, along with South Carolina Treasurer Curtis Loftis, West Virginia Treasurer Riley Moore, Alabama Auditor General Andrew Sorrell, Nevada State Controller Andy Matthews and Indiana Treasurer Daniel Elliott.
Matthews said the bill gives Congress the opportunity to “resolve a serious threat to the privacy of the American people.”
Elliott said the CAT is a “data privacy nightmare” that allows the feds to wrongly track financial information of typical American retail investors.
“Our government has shown that when it gives itself this amount of power, it will act irresponsibly and in ways that will harm average American citizens. This entire project should be subject to an act of Congress, not un-elected Washington bureaucrats.”
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A group tied to another noted Hoosier, former Vice President Mike Pence, also spoke out against the SEC’s move and pressed for Johnson to act.
“Conservatives should co-sponsor and demand a floor vote on [the bill] … to ensure that Americans’ financial data is protected,” a June 5 release from Pence’s group, Advancing American Freedom, stated.
“Traditionally, Americans’ financial holdings are kept between them and their broker, not them, their broker and a massive government database. The only exception has been legal investigations with a warrant.”
The bill has 13 co-sponsors, all Republicans, the latest addition being Rep. Alex X. Mooney, R-W.V., who added his name to the legislation April 23.
Meanwhile, the executive director of the State Financial Officers Foundation Action told Fox News Digital the SEC database was never congressionally authorized and called for a floor vote “as soon as possible,” highlighting due process concerns.
The SEC formally adopted Rule 613 enacting the plan in 2023, while the CAT system has been in place in some form since 2012, according to the commission’s website. The finalized phase of implementation occurred May 31.
The commission argued in announcing the new rule that it creates a trail that allows regulators to efficiently and accurately track all securities activity throughout U.S. markets.
Calls placed to Johnson’s office for comment were not returned before press time.