The final rules for the audit trail were significantly eased from the SEC's initial proposal. It dropped a requirement for real-time reporting and gave exchanges far more flexibility in how they structure the reporting. At the same time, the SEC added a requirement that exchanges provide detailed information about how shares are allocated for initial public offerings.

The IPO rule requires exchanges to identify all market participants including broker-dealers and customers that are allocated securities directly or indirectly, the number of securities each market participant is allocated and the identity of the broker-dealer making the allocation.

The new rules were prompted by the information shortfall that hindered the SEC's ability to trace the cause of the May 2010 flash crash.

In an unusual alignment of votes, Democratic SEC Chairwoman Mary Schapiro joined two Republican commissioners to form the majority needed for passage. She said the trail would provide the agency with the kind of detailed additional information to track the modern market and quickly identify and track schemes, trends and problems.

"A consolidated audit trail that accurately tracks orders throughout their lifecycle and identifies the broker-dealers handling them will provide us with an unprecedented ability to effectively oversee the markets we regulate," she said.

Two Democratic SEC Commissioners, Elisse B. Walter and Luis A. Aguilar, strongly opposed the measure, suggesting the final requirements were watered down, giving exchanges too much flexibility to develop plans of compliance rather then setting clear requirements.

Walter suggested the commission was going to "squander an opportunity."

"This is a moment in which the commission should be taking decisive steps," Walter said. "Instead, we are adopting an overly cautious approach that falls far short of where we need to be."

Aguilar said the rule "falls short of establishing the process that investors deserve. I am concerned that the proposal fails to set appropriately specific requirements to ensure the creation of a comprehensive market surveillance system," he said.

As adopted Wednesday, the commission required that exchanges and self-regulatory organizations provide detailed information on trades and quotes to a central repository. The data must include cancellations as well as executed trades and the information must be provided electronically with the time of the transaction identified by the millisecond. The information has to be trackable to an individual broker-dealer and account.

SEC officials said the level of information required would allow the SEC for the first time to easily track cross-market trading and identify patterns that warrant enforcement action or trends that may need to be monitored.

Exchanges have to submit a plan within a year and reporting would start sometime in 2015.

The final version abandoned the SEC's initial proposal for real-time reporting. Instead, transactions have to be reported by 8 a.m. of the next business day. It also offered exchanges more flexibility on how they report the information and the reports they use, dropping a requirement for a specific identifier for each transaction. Instead, information furnished has to be easily identifiable by account and permit the central repository to eventually easily combine information from multiple markets to form a picture of a trader's activity. The SEC also gave smaller exchanges more time to implement the new rules. Finally, it required exchanges to increase the safeguards to ensure the information remains confidential and to ensure that any mistaken records are corrected.

Schapiro said the level of information the SEC is getting about trades hasn't kept up with trading and noted that when the SEC examined the cause of the flash crash, the agency had to spend four months to determine what happened across a number of markets.

She said the consolidated audit trail "will increase the data available to regulators investigating illegal activities such as insider trading, wash sales, and market manipulation;" facilitate risk-based examinations and faster surveillance; improve regulators' ability to reconstruct broad-based market events in a timely manner; and increase the ability of regulators to monitor overall market structure and better understand impacts of high-frequency trading.

Walter called the rule "disappointingly weak."

"The ultimate effectiveness of regulatory efforts depends on the accuracy, completeness, accessibility, and timeliness of audit trail data. Yet, the rule fails to set meaningful minimum requirements to assure that these important goals are achieved. The rule has been altered to be less prescriptive and hence less directional," she said.

The two Republican Commissioners, Daniel M. Gallagher and Troy A. Paredes, praised the rule.

So did the Securities Industry and Financial Markets Association. "The revisions the SEC has made since their original proposal strengthen and enhance the establishment of a consolidated audit trail," SIFMA executive vice president Randy Snook said. He called the SEC's move away from real-time reporting "a more manageable and cost-effective approach to this kind of system."