FINRA Risk Monitoring in 2025: How Firms Can Strengthen CAT & CAIS Compliance with RSMS and CAIS-Con

ISELIN, N.J. - Oct. 22, 2025 - PRLog -- regulatory expectations for broker-dealers have evolved faster than ever. With increasing scrutiny from FINRA and the SEC, firms are expected to maintain airtight compliance programs, especially around risk monitoring, cybersecurity, data governance, and trade reporting accuracy. The latest FINRA 2025 Annual Regulatory Oversight Report (AROR) makes it clear: risk monitoring is now the foundation of regulatory compliance.

To remain compliant and avoid costly penalties, firms must reinforce their programs for:

Consolidated Audit Trail (CAT) Compliance

Customer Account Information System (CAIS) reporting

Anti-money laundering and market manipulation surveillance

Cybersecurity and third-party risk governance

Extended-hours and manipulative trading oversight

This blog breaks down FINRA's risk-monitoring expectations and shows how advanced RegTech solutions like RSMS and CAIS-Connect help firms automate compliance, reduce reporting errors, and stay audit-ready.

📌 Why Risk Monitoring Matters More Than Ever
FINRA stresses that firms must maintain a proactive approach when it comes to identifying, measuring, and mitigating risks that impact investors and market integrity. Gaps in surveillance or trade reporting systems—especially CAT and CAIS—can now result in:

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Regulatory penalties

Reconciliation backlogs

Audit failures

Customer impact

Reputational risk

To avoid these outcomes, firms must upgrade outdated, manual, or spreadsheet-driven compliance processes.

📌 Cybersecurity & Fraud: A Top FINRA Priority
FINRA's AROR highlights a surge in:

Phishing and cyber-enabled fraud

Ransomware targeting financial data

Vendor system vulnerabilities

Firms must adopt multi-layer monitoring systems and closely evaluate their third-party vendors' controls. A single cyber gap at a vendor can still trigger Regulation S-P violations.

📌 Market Integrity, Manipulative Trading & Extended-Hours Risk
Firms must enhance surveillance protocols, particularly for:

Spoofing and layering

Best execution oversight

Thin-liquidity trading periods

CAT reporting accuracy and timelines

CAT data inaccuracies continue to be one of FINRA's

most common exam findings—which is why CAT automation tools are now considered essential.

📌 CAT and CAIS: At the Core of FINRA's 2025 Expectations
Consolidated Audit Trail (CAT) Compliance requires firms to submit accurate lifecycle reporting for every order.

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Customer Account Information System (CAIS) requires firms to maintain correct account-holder and relationship data.
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FINRA is now laser-focused on: