BROWSE BY TOPIC
- Bad Brokers
- Compliance Concepts
- Investor Protection
- Investments - Unsuitable
- Investments - Strategies
- Wall Street News
- Investments - Private
- Rules & Regulations
- Bad Advisors
- Boiler Rooms
- Terminations/Cost Cutting
- General News
- Donald Trump & Co.
- Regulatory Sanctions
- Big Banks
Stories of Interest
- Sarah ten Siethoff is New Associate Director of SEC Investment Management Rulemaking Office
- Catherine Keating Appointed CEO of BNY Mellon Wealth Management
- Credit Suisse to Pay $47Mn to Resolve DOJ Asia Probe
- SEC Chair Clayton Goes 'Hat in Hand' Before Congress on 2019 Budget Request
- SEC's Opening Remarks to the Elder Justice Coordinating Council
- Massachusetts Jury Convicts CA Attorney of Securities Fraud
- Deutsche Bank Says 3 Senior Investment Bankers to Leave Firm
- World’s Biggest Hedge Fund Reportedly ‘Bearish On Financial Assets’
- SEC Fines Constant Contact, Popular Email Marketer, for Overstating Subscriber Numbers
- SocGen Agrees to Pay $1.3 Billion to End Libya, Libor Probes
- Cryptocurrency Exchange Bitfinex Briefly Halts Trading After Cyber Attack
- SEC Names Valerie Szczepanik Senior Advisor for Digital Assets and Innovation
- SEC Modernizes Delivery of Fund Reports, Seeks Public Feedback on Improving Fund Disclosure
- NYSE Says SEC Plan to Limit Exchange Rebates Would Hurt Investors
- Deutsche Bank faces another challenge with Fed stress test
- Former JPMorgan Broker Files racial discrimination suit against company
- $3.3Mn Winning Bid for Lunch with Warren Buffett
- Julie Erhardt is SEC's New Acting Chief Risk Officer
- Chyhe Becker is SEC's New Acting Chief Economist, Acting Director of Economic and Risk Analysis Division
- Getting a Handle on Virtual Currencies - FINRA
We seek to provide information, insights and direction that may enable the Financial Community to effectively and efficiently operate in a regulatory risk-free environment by curating content from all over the web.
Stay Informed with the latest fanancialish news.
NEWSLETTERS & ALERTS
Citadel Securities to Pay $22Mn for Misleading Clients About Pricing Trades - SEC
Citadel Securities agreed to pay $22.6 million in fines, disgorgement and prejudgment interest to settle SEC charges that its business unit handling retail customer orders from other brokerage firms made misleading statements to them about the way it priced trades.
According to the SEC order ….. from late 2007 to January 2010, Citadel Execution Services suggested to its B/D clients that, upon receiving retail orders they forwarded from their own customers, it either internalized the order – i.e., took the other side of the trade - and provided the best price observed on various market data feeds, or it sought to obtain that price in the marketplace.
As a “wholesale market maker” or “internalizer” that specializes in handling retail orders from investors who are customers of other broker-dealers, Citadel Securities executes approximately 35% of the average daily volume of retail equity shares traded in the U.S. markets.
However, the SEC says that the 2 algorithms used by Citadel Securities did not internalize retail orders at the best price observed nor sought to obtain the best price in the marketplace. Instead, they were triggered when they identified differences in the best prices on market feeds, comparing the SIP feeds to the direct feeds from exchanges.
- One strategy, known as FastFill, immediately internalized an order at a price that was not the best price for the order that Citadel Securities observed.
- Another strategy, known as SmartProvide, routed an order to the market that was not priced to obtain immediately the best price that Citadel Securities observed.
While acknowledging that the two algorithms represented a small part of Citadel Securities’ internalization business, Robert Cohen, Co-Chief of SEC Enforcement, said they “nevertheless affected millions of orders placed by retail investors because of Citadel Securities’ large role in that market.”