A recently-filed lawsuit claims that the Securities and Exchange Commission, or SEC, illegally collects the data of every U.S. citizen who invests in the stock market.According to FOX News, the lawsuit was filed late last week by the New Civil Liberties Alliance. In its complaint, the NCLA alleges that the Securities and Exchange Commission uses its “Consolidated Audit Trail” program to collect massive amounts of sensitive and personally-identifiable data from brokers, exchanges, and clearing agencies.“Historically, a government that wished to track its citizens had to devote large resources to having them followed. This is no longer the case,” the lawsuit alleges. “Modern surveillance tools enable [the] mass tracking of individuals’ every movement, every transaction, every purchase, sale, or transfer of securities at low cost while powerful computer algorithms can process that information to reveal personal and private details of each person’s financial life or investment strategy.”“This class action complaint challenges SEC’s shocking arrogation of power to impose dystopian surveillance, suspicionless seizures, and real or potential searches on millions of American investors,” the complaint claims.

Stock market concept image. Image via Flickr/user:quoteinspector/QuoteInspector.com. (CCA-BY-2.0).

Attorneys for the NCLA say that the Consolidated Audit Trail, which operates on a multibillion-dollar budget, was engineered without authorization from Congress—and is therefore in violation of the Fourth Amendment to the United States Constitution, which prohibits the government from conducing unlawful searches and seizures. This protection has, in the past, been extended to the collection of certain types of information.“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,” said NCLA senior litigation counsel Peggy Little.“The Founders,” Little said, “provided rock-solid protections in our Constitution to prevent just these autocratic and dangerous actions. This CAT must be ripped out, root and branch.”In a statement, other NCLA attorneys emphasized the scale of the Consolidated Audit Trail’s allegedly unlawful surveillance—saying that it collects not only data on stock exchange trades and transfers, but information relating to retirement accounts and pension funds, too.“To create the Consolidated Audit Trail, the SEC has mowed down venerable constitutional safeguards that shield citizens’ private information from the government,” NCLA senior litigation counsel Andrew Morris said. “This new database tracks investments made by more than 100 million private citizens who have done nothing wrong—citizens who want to invest to buy a house, pay for their children’s education, or save for retirement. It’s no surprise that Congress never authorized any of this.”“In this lawsuit,” Morris said, “we ask the Court to put a stop to it.”

Sources

NCLA Unleashes Lawsuit to Take Down SEC’s Illegal Mass Data Collection MachineSEC hit with new lawsuit alleging 'mass surveillance' of Americans through stock market dataSEC’s Market Surveillance Tool Called Unconstitutional in Texas Lawsuit