NCLA Files Class Action Lawsuit Against SEC Alleging Unlawful Surveillance of American Investors
The New Civil Liberties Alliance (NCLA) has initiated a class action lawsuit against the Securities and Exchange Commission (SEC) accusing the agency of illegally gathering extensive personal data on every American citizen who invests in the stock market. The lawsuit filed on Tuesday in the Western District of Texas targets the SEC’s “Consolidated Audit Trail” (CAT) program.
According to the NCLA the CAT program mandates that brokers exchanges clearing agencies and alternative trading systems capture and submit detailed information about every investor’s trades to a centralized database. The lawsuit argues that this effort has been carried out without congressional authorization and infringes upon Americans’ Fourth Amendment right protections against unreasonable government search and seizure of private information.
It’s a good thing Congress didn’t just expand and reauthorize FISA without requiring a warrant.
Oh wait.https://t.co/0l5qDArjWY
— Mike Lee (@BasedMikeLee) April 22, 2024
Peggy Little NCLA senior litigation counsel asserted “By seizing all financial data from all Americans who trade in the American exchanges SEC arrogates surveillance powers and appropriates billions of dollars without a shred of Congressional authority — all while putting Americans’ savings and investments at grave and perpetual risk.”
The CAT program established under former President Barack Obama with bipartisan support within the SEC is a self-appropriated multi-billion-dollar fund. The NCLA states that the program’s funding comes from various fees collected by the agency through investment transactions.
Speaking with Fox News Digital, Little further elaborated that the SEC’s database collects and stores every piece of “trade information on every investor’s trades from inception to completion” including information about Americans’ 401(k) or 529 Education Fund. She contended “And there is simply no law that permits them to do that and the Fourth Amendment forbids them to do that.”
The NCLA’s lawsuit asserts that CAT represents “the greatest government mandated mass collection of personal financial data in United States history.” It points out that while in the past a government seeking to track its citizens had to allocate significant resources to physically follow them modern surveillance tools now enable mass tracking of individuals’ every movement transaction purchase sale or transfer of securities at low cost. Powerful computer algorithms can then analyze that information to uncover personal and private details of each person’s financial life or investment strategy.
The lawsuit challenges what the NCLA characterizes as the SEC’s “shocking arrogation of power to impose dystopian surveillance suspicionless seizures and real or potential searches on millions of American investors.”
