June 18, 2019

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FINRA Proposes To Require Members To Report Transactions in US Treasury Securities to TRACE

On July 19, the Financial Industry Regulatory Authority filed a proposed rule change with the Securities and Exchange Commission to amend its Trade Reporting and Compliance Engine (TRACE) reporting rules to require the reporting of transactions in all US Treasury Securities other than US savings bonds. This proposal would include transactions in US Treasury bills, notes and bonds, as well as separate principal and interest components of a US Treasury Security that have been separated pursuant to the Separate Trading of Registered Interest and Principal of Securities (STRIPS) program operated by the Treasury Department.

Purchases of US Treasury Securities by a FINRA member from the Treasury Department in connection with an auction would be exempt from these reporting requirements. However, when-issued trading in these securities would be reportable. In addition, repurchase and reverse repurchase transactions involving US Treasury Securities would not be reportable to TRACE.

The proposed rule change would require members to report transactions in US Treasury securities to TRACE on an end-of-day basis, and FINRA is not currently proposing to disseminate the information it receives under the proposal to the public. FINRA also is not proposing to charge transaction-level fees on the transactions in US Treasury Securities reported to TRACE at this time.

More information is available here.

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About this Author

Ross Pazzol, Financial Institutions lawyer, Katten Muchin Law firm

Ross Pazzol’s practice encompasses a broad range of financial services matters. He focuses primarily on the regulation of broker-dealers, futures commission merchants, investment companies and hedge funds, clearinghouses and investment advisers.

Ross has significant experience in all aspects of exchange-traded and over-the-counter derivatives transactions as well as securities financing and lending arrangements, and assists clients in understanding the documentation issues and regulatory and credit considerations that arise in connection with...


Timothy Kertland concentrates his practice on transactional, corporate and regulatory aspects of financial services matters. Timothy is able to provide legal services to a wide variety of clients including proprietary trading firms, hedge funds, broker-dealers, registered investment advisers, and commodity trading advisers.

While in law school, Timothy served as an editor of the Virginia Tax Review. As a first-year law student, he represented the University of Virginia School of Law at the National Transactional LawMeets Competition.