Having already put the mysterious, opaque platforms on notice, Mary Jo White & Co. are beginning to undress them. One’s already in the soup for taking a little too much pride in the folks it was quietly and very untransparently trading for. The rest are now having some light shone upon the disclosures they’re supposed to be making but maybe aren’t.
Investigators are exploring whether the trading systems are properly disclosing to clients how they operate, treating all investors fairly and protecting confidential client information, among other concerns, the people said….
Among the dark pools under investigation by the SEC is one operated by Barclays PLC, the people said. Barclays’ dark pool, called LX, was the second largest by trading volume in early May behind Credit Suisse Group AG’s dark pool, Crossfinder, according to data compiled by the Financial Industry Regulatory Authority.
It isn’t clear which other trading systems the SEC is investigating and if the probe will lead to an enforcement action. If it does, it would be the first SEC case against a major dark-pool operator in the U.S. in recent years.