The IRS targeted conservatives for years – and Democrats called it a paperwork error.
Now a different federal agency built something far worse, and the deadline to kill it is days away.
Senator John Kennedy revealed what the SEC has been doing to your retirement account – and he is furious.
The SEC Consolidated Audit Trail Is the Largest Investor Surveillance Database Ever Built
The program is called the Consolidated Audit Trail – the CAT – and it is exactly what it sounds like.
Since the Biden administration launched it, the SEC has collected and stored 116 trillion investor transactions in 2023 alone, then added 154 trillion more in 2024.
If you own a 401(k), a brokerage account, or a single share of stock, your trades are in there.
The SEC tracks who you invest in, how much you invest, when you buy and when you sell – and it does all of this without a warrant, without probable cause, and without a single vote in Congress authorizing any of it.
Biden instituted this program as part of its agenda to step up IRS audits to wring more out of taxpayers for his socialist agenda.
John Kennedy said in his June 2026 amicus brief: the Biden-era SEC pushed the Consolidated Audit Trail without clear authority from Congress, put Americans' private financial data at risk, and tried to make investors pay for it.
Tom Cotton was even more direct: "The SEC gave itself a surveillance database on the backs of American investors and never bothered to ask Congress. That's not how the Constitution works. It's time to end it."
How the SEC CAT Database Violates Your First and Fourth Amendment Rights
The New Civil Liberties Alliance has sued the SEC over the CAT in federal court in Texas, and their argument holds up at every level.
The Supreme Court ruled in NAACP v. Alabama (1958) that the government cannot force Americans to disclose the organizations they financially support.
Alabama tried to compel the NAACP to hand over its membership lists so the state could identify and pressure its supporters.
The Court said no – unanimously – because forced disclosure of who you associate with is itself a form of government intimidation.
The CAT does the same thing at a scale Alabama could never have imagined.
It captures not just transaction data but the investment decisions behind every trade – which companies you trust with your money, which industries you back, which businesses you believe in.
The Supreme Court has twice confirmed this kind of forced disclosure violates the First Amendment – first in NAACP v. Alabama, then again in Americans for Prosperity v. Bonta (2021), when California tried to compel nonprofits to hand over their donor lists.
SEC Commissioner Hester Peirce warned years ago that the CAT gives Washington the tools to stalk personal or political enemies.
That warning is a lot more chilling now that the same government that weaponized the IRS against Tea Party groups has a complete financial map of every American with a brokerage account.
The NCLA's lawsuit argues the CAT violates the First, Fourth, and Fifth Amendments simultaneously – warrantless searches, compelled self-incrimination, and forced disclosure of associational choices.
The Eleventh Circuit already agreed the SEC overstepped, striking down its funding mechanism in 2025 for violating the Administrative Procedure Act.
The SEC rebuilt the funding scheme anyway and kept the database running.
Kennedy and Cotton Demand Congress Shut Down the SEC Investor Data Grab
Kennedy has been fighting this for years– introducing the Protecting Investors' Personally Identifiable Information Act twice and warning that China's cyber operations make this database a national security catastrophe waiting to happen.
He is right about the hack risk.
The CAT stores Social Security numbers, birth dates, account numbers, and full trading histories in a centralized database that SEC employees and outside contractors can search at will.
The Supreme Court acknowledged last month in First Choice Women's Resource Centers v. Davenport that sensitive information disclosed to the government can wind up in the public domain through a hack or leak.
The SEC has already demonstrated it cannot protect sensitive data.
Kennedy and Cotton filed a fresh amicus brief on June 1 alongside ten other colleagues – including Senators Hagerty and Tim Scott – pushing the Eleventh Circuit to shut the CAT down permanently.
The cost alone should make every American investor angry.
The CAT's annual operating costs exceed $155 million – and the SEC passes those costs directly to investors.
Biden built a secret financial surveillance database, forced the people being surveilled to pay for it, and dared Congress to stop him.
The reason his administration never brought this to Congress is simple: they knew Congress would say no.
The SEC's public comment window closes June 15. That is the last clean shot to make Washington say it officially.
Sources:
- Christian Clase and Margot Cleveland, "The SEC's Mass Surveillance of Investors' Transactions Violates First Amendment," The Federalist, June 8, 2026.
- "Kennedy, Cotton to Fight Collection of American Investors' Data with Amicus Brief," Office of Sen. John Kennedy, June 1, 2026.
- "A Call to Arms Against the SEC's Spy Games," RealClearPolitics, May 14, 2026.
- New Civil Liberties Alliance, "American Securities Association v. SEC," NCLA Legal, April 2026.
- Cato Institute, "American Securities Association v. SEC," Amicus Brief, June 2026.
