THE ETHICS REPORTER

May 15, 2026

Tens of Billions of Order Events Unreported: Inside Citadel Securities' CAT Reporting Failures

Tens of Billions of Order Events Unreported: Inside Citadel Securities' CAT Reporting Failures

In October 2024, the Financial Industry Regulatory Authority (FINRA) announced that Citadel Securities LLC had agreed to pay a $1 million fine and accept a censure for failing to timely and accurately report data to the Consolidated Audit Trail (CAT) — the regulatory system designed to allow regulators to track all activity in U.S. equity and options markets.

The violations, according to FINRA's Letter of Acceptance, Waiver, and Consent (AWC), spanned from June 22, 2020 — the first day Citadel Securities was required to report to CAT as a large industry member — through August 28, 2024.

The Scale of the Failures

According to the FINRA AWC, the reporting failures were extensive:

  • From June 22, 2020, through July 31, 2022, Citadel Securities inaccurately reported data fields for approximately 42.2 billion equity and option order events, spanning 33 unique CAT reporting error types.
  • During the same period, the firm failed to timely report approximately 580 million equity and option order events.
  • After remediating the original 33 error types, Citadel Securities identified four additional issues that caused failures in reporting for approximately 3.2 billion equity order events from December 13, 2021, through June 30, 2024.

Three error types alone accounted for 41.8 billion of the inaccurately reported events:

  • 31.2 billion canceled order events with incorrect "leaves quantity" field reporting (June 22 – December 31, 2020)
  • 6.3 billion new order events with an incorrect indicator applied (June 22, 2020 – April 9, 2021)
  • 4.3 billion IOC order events missing the required Time-in-Force code (June 22, 2020 – February 16, 2022)

Why This Matters

The CAT system was mandated by the SEC specifically to create a comprehensive audit trail enabling regulators to detect market manipulation, abusive short selling, and other violations. FINRA noted in the AWC that accurate and timely CAT reporting "is integral to their automated market surveillance program and their ability to detect manipulative activity and other potential violations of securities laws."

When Citadel Securities — which handles a substantial share of U.S. retail equity order flow — submits tens of billions of inaccurate records to that system, regulators are working from incomplete or incorrect data.

The Violations and the Causes

By failing to timely and/or accurately report order event data, Citadel Securities violated FINRA Rules 6830, 6893, and 2010, according to the AWC. FINRA found the failures were "caused by various coding and system issues, issues with data received from third parties, and the firm's interpretation of certain reporting scenarios." Citadel Securities identified many of the errors through its own supervisory reviews.

Kevin Nutter

Business records, including professional directories, identify Kevin Nutter as Chief Operating Officer of Data at Citadel. The Ethics Reporter is reporting his name and title as a matter of public record in connection with this enforcement period, consistent with our coverage of the organizational structure governing Citadel's data operations. No claims of personal wrongdoing are made against Mr. Nutter in connection with the FINRA enforcement action; the action was brought against Citadel Securities LLC as an entity.

The Settlement

Citadel Securities agreed to a $1 million fine and censure. The firm completed remediation of the issues by June 30, 2024, and submitted corrections by August 28, 2024.

Sources: FINRA AWC No. 2020068778601 (Citadel Securities LLC, CRD No. 116797); FINRA announcement, October 2024. Figures are drawn directly from FINRA's public disclosure documents and reporting by GRC Report and FX News Group citing the AWC.

The Ethics Reporter covers documented regulatory actions and enforcement proceedings in the financial industry. Support independent accountability journalism at theethicsreporter.com/donate.

Citadel SecuritiesFINRACATConsolidated Audit TrailKevin Nuttermarket surveillanceorder reportingenforcementKenneth Griffin

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