CAT’s Out of Cash: SEC’s Surveillance Scheme Suffers a Legal Blow

In this episode of Unwritten Law, Mark Chenoweth and John Vecchione unpack a major federal court ruling that struck down the SEC’s funding mechanism for its mass surveillance program—known as the Consolidated Audit Trail (CAT).

The 11th Circuit agreed with the American Securities Association and Citadel that the SEC's attempt to impose multi-billion-dollar fees on broker-dealers was arbitrary, capricious, and totally untethered from Congressional authorization.

Mark and John break down how this massive Fourth Amendment–invading program was never passed by Congress, never properly funded, and yet was still collecting every American investor’s stock transaction.

They also discuss NCLA’s companion case, Davidson v. SEC, which challenges the CAT’s very existence—and what this win means for reining in agency power, restoring constitutional order, and stopping self-funded surveillance regimes.

Keywords: SEC surveillance, Consolidated Audit Trail, CAT, Davidson v. SEC, Fourth Amendment, administrative state, unlawful taxation, 11th Circuit opinion, American Securities Association, Citadel, pro-liberty legal podcast