Banks reach $154M deal
WASHINGTON — Two major global banks, Barclays and Credit Suisse, are paying a combined $154.3 million to settle government investigations that they misled clients about being able to safely trade on their “dark pool” financial exchanges, the Securities and Exchange Commission and the New York Attorney General’s office said Sunday.
The banks left their customers on these private exchanges vulnerable to “predatory, high-frequency traders” that could intercept and profit off their financial transactions, despite assurances by Barclays and Credit Suisse to the contrary, according to a statement the New York Attorney General.
“These cases mark the first major victory in the fight to combat fraud in dark pool trading,” said New York Attorney General Eric Schneiderman. “We will continue to take the fight to those who aim to rig the system and those who look the other way.”
Zurich-based Credit Suisse, a major firm on Wall Street, said it was “pleased to have resolved these matters.” Barclays was unavailable for comment.
Dark pools are private exchanges for trading stocks and bonds. Unlike traditional markets with public prices, trades on dark pools are generally confidential.
The investigations found that high-speed traders could get early access to dark pool trades and gain an unfair advantage.
