Days after Bitcoin News, SEC Charges Citigroup for Dark Pool Misrepresentations

SEC Charges Citigroup for Dark Pool Misrepresentations

There’s huge news from the financial industry this morning as the SEC just announced charges against Citigroup “for dark pool misrepresentations.”

As reported by the commission’s official SEC News Twitter, Citigroup and an affiliate have been ordered to pay more than $12 million in disgorgement and penalties.

Citigroup and its affiliate, Citi Order Routing and Exchange (CORE) allegedly misrepresented trading activity to users. CORE and its flagship platform Citi Match were caught processing orders on other platforms while telling users that orders were processed through CORE. Citigroup and CORE also misled high-frequency traders seeking to make trades through CORE.

The orders involve dark pools, which are private forums for trading securities, derivatives, and other financial instruments away from the general public. Although it’s an ominous sounding term, dark pools and dark pools of liquidity are used by many to participate in traditional markets in a legal and regulated way.

The full explanation of the charges can be found at SEC.gov here. Here’s how the SEC explains things:

“The Securities and Exchange Commission today entered an order finding that Citigroup Global Markets Inc. misled users of a dark pool operated by one of its affiliates.”

According to the SEC:

“[Citigroup] misled users with assurances that high-frequency traders were not allowed to trade in Citi Match, a premium-priced dark pool operated by Citi Order Routing and Execution (CORE), when two of Citi Match’s most active users reasonably qualified as high-frequency traders and executed more than $9 billion of orders through the pool.”

The SEC also found that Citigroup failed to disclose that approximately half of Citi Match orders were routed to and executed I other trading venues over a two year period of time. Citi Match was sending orders to other dark pools and exchanges that did not have the same premium features as Citi Match. At the same time, Citi Match was sending confirmation emails to users acknowledging that their trades had been completed on Citi Match when in reality, they had been completed on other trading platforms.

“Market participants deserve to make informed decisions about where they execute their orders,” said Joseph G. Sansone, Chief of the SEC Enforcement Division’s Market Abuse Unit in the original press release on SEC.gov.

“All trading venues, regardless of their trade volume, must ensure that their users have accurate information, particularly about key issues like order routing.”

Because of the actions above, Citigroup violated an anti-fraud provision of the federal securities laws. Citigroup has not admitted to the SEC’s charges, nor have they denied them, but they “have agreed to be censured.”

Citigroup will pay disgorgement and prejudgement interest totaling $5.44 million along with a penalty of $6.5 million while CORE will pay a penalty of $1 million.

Get Free Email Updates!

*Action* Enter Best Email to Get Trending Crypto News & Bitcoin Market Updates

I will never give away, trade or sell your email address. You can unsubscribe at any time.

Avatar
Bitcoin Exchange Guide News Team
B.E.G. Editorial Team is a gracious group of giving cryptocurrency advocates and blockchain believers who want to ensure we do our part in spreading digital currency awareness and adoption. We are a team of over forty individuals all working as a collective whole to produce around the clock daily news, reviews and insights regarding all major coin updates, token announcements and new releases. Make sure to read our editorial policies and follow us on Twitter, Join us in Telegram. Stay tuned. #bitcoin

[Alert] Use the author's self-conducted information at your own risk, do you own research, never invest more than you are willing to lose.

[Disclosure] The published news and content on BitcoinExchangeGuide should never be used or taken as financial investment advice. Understand trading cryptocurrencies is a very high-risk activity which can result in significant losses. Editorial Policy \\ Investment Disclaimer

LEAVE A REPLY

Please enter your comment!
Please enter your name here

3,470FansLike
2,795FollowersFollow
4,194FollowersFollow

Live Bitcoin Price & Latest BTC Charts

Today's Latest Crypto News

Bitcoin Adoption Explosion in Africa, Led by Nigeria, Kenya, and South Africa

Bitcoin continues to gain traction in Africa, with Kenya being the most bitcoin maximalist country, with 94.7% dominance. The top 10 list also contains...

DeFi App Growth Boosts Total Transactions On DApp Blockchains By $4.5B In Q2 2020: DAppRadar Report

In a report by DApp Radar, the total transactional volume on DApps touched the $12 billion mark in Q2 2020, representing a $4.5 billion...

Bitcoin to Follow the Equities Market Up or Down? One-Month Correlation Spikes to an All-Time High

Yet another week of weak price movement. The world’s leading digital asset is trading at $9,072, in red with 24 hours ‘real’ volume of just...

Public Mint Launches Its Blockchain; Over 200 Banks Plan to Support Its Digital Money

vPublic Mint, a firm founded by CNET founder Halsey Minor, has announced the launching of its ‘fiat-native’ public blockchain, which enables anyone to easily...

BTC Halving Week Brings in Record Monthly New Accounts & Doubles the Revenue for BlockFi

The past two months have been incredibly dull for the price of bitcoin, but it didn’t affect the businesses in the cryptocurrency space. The...

BitcoinExchangeGuide is a hyper-active daily crypto news portal with care in cultivating the cryptocurrency culture with community contributors who help rewrite the bold future of blockchain finance. Subscribe on Google News, see the mission, authors, editorial links policy, investment disclaimer, privacy policy. Got News? Contact us, we are human too. Note: nothing here is financial advice, do your own research thoroughly.

Start Using Crypto Today