Regulation8 min readPublished 2026-02-02Updated 2026-02-03
SEC & FINRA Supervision for Autonomous Trading
Firms must demonstrate supervision of automated trading systems, ensure record retention, and prevent market manipulation.
Key Takeaways
- •Supervision must be demonstrable with logs and controls
- •Recordkeeping rules demand immutable retention
- •Pre-trade controls reduce regulatory exposure
Supervision and compliance controls
FINRA emphasizes supervisory procedures for algorithmic trading.
Controls should be policy-driven with clear escalation paths.
Record retention requirements
SEC 17a-4 requires tamper-evident recordkeeping.
Audit trails should be exportable and time-stamped.
Market integrity safeguards
Controls for wash trading, spoofing, and excessive order rates are essential.
A governance engine should enforce thresholds before orders reach venues.
Francesco Tomatis
CEO & Founder, Kuneo
This article is for informational purposes only and does not constitute legal or financial advice.