27 August 2016
Find out more

Barclays seeks dismissal of NY Attorney General's dark pool lawsuit

24 July 2014  |  5557 views  |  1 Barclays branch sign

Barclays has filed a motion seeking to throw out a lawsuit from the New York Attorney General accusing the bank of deceptively luring unwary investors to a dark pool that was actually being run for the benefit of predatory high-frequency traders.

The suit filed last month by crusading New York Attorney General Eric Schneiderman, claims that Barclays dramatically increased the market share of its dark pool by lying to clients about the level of protection they would receive from high-frequency trading firms.

The complaint alleges that the bank falsified marketing material and client reports to hide the extent and type of high frequency trading in its LX dark pool.

However, in its motion to dismiss it, Barclays says that the complaint "fails to identify any fraud-establishing no material misstatements, no identified victims, and no actual harm".

The bank says that Schneiderman's case ignores that LX customers are "highly sophisticated" traders and asset managers that rely on detailed execution data to decide where to execute their trades, "not on the glossy marketing brochures or quotes from magazine articles the NYAG cites".

In addition, Barclays says that Schneiderman does not even have the authority to bring the case because the Martin Act - on which the claims are predicated -is limited to actions for fraud in the purchase or sale of securities' while the allegations concern only the functioning of LX as an ATS.

Finally, the bank says that the complaint is wrong to seek damages and restitution for the people of the state of New York when it is not alleging that they suffered any harm.

Responding, Schneiderman's communications director Damien LaVera says: "We are confident that a judge will reject this motion and allow us to prove these disturbing allegations in Court."

Comments: (1)

Jim Wells
Jim Wells - Wellspring Consulting International - Fort Lauderdale | 25 July, 2014, 16:29

How ironic that after US & UK financial regulators have allowed mega-banks to victimize customers with impunity for decades, Barclays now feels it is being victimized by an authority that seeks to hold it accountable for just one of its nefarious activities.  Jim Wells

 

 

Be the first to give this comment the thumbs up 0 thumb ups! (Log in to thumb up)
Comment on this story (membership required)

Finextra news in your inbox

For Finextra's free daily newsletter, breaking news flashes and weekly jobs board: sign up now

Related stories

NY Attorney General files lawsuit over Barclays' 'toxic' dark pool

NY Attorney General files lawsuit over Barclays' 'toxic' dark pool

26 June 2014  |  5322 views  |  1 comments | 2 tweets | 3 linkedin
Liquidnet fined $2m for misusing dark pool subscriber data

Liquidnet fined $2m for misusing dark pool subscriber data

09 June 2014  |  5437 views  |  1 comments | 1 tweets | 2 linkedin
SEC chair sets out HFT and dark pool proposals

SEC chair sets out HFT and dark pool proposals

06 June 2014  |  5204 views  |  0 comments | 5 tweets | 1 linkedin
New York attorney general sets sights on co-location

New York attorney general sets sights on co-location

18 March 2014  |  5519 views  |  1 comments | 3 tweets | 6 linkedin
New York attorney general goes after HFT cheats

New York attorney general goes after HFT cheats

25 September 2013  |  6767 views  |  1 comments | 2 tweets | 1 linkedin
Dark pool trading costing US investors billions - study

Dark pool trading costing US investors billions - study

07 June 2013  |  6018 views  |  0 comments | 11 tweets | 6 linkedin

Related company news

 

Related blogs

Create a blog about this story (membership required)
Visit VocaLink.comVisit www.abe-eba.euFind out more

Top topics

Most viewed Most shared
hands typing furiouslyBig Data's Three Big Trends in 2016
7666 views 5 | 22 tweets | 13 linkedin
hands typing furiouslyHow Banks Are Losing Millions by Ignoring...
7469 views 11 | 24 tweets | 9 linkedin
Nordea looking for AI and blockchain breakthroughsNordea looking for AI and blockchain break...
6546 views comments | 17 tweets | 20 linkedin
R3 blockchain consortium sheds light on Concord projectR3 blockchain consortium sheds light on Co...
5943 views comments | 14 tweets | 14 linkedin
India's Unified Payments Interface goes live with 21 banksIndia's Unified Payments Interface goes li...
5551 views comments | 15 tweets | 18 linkedin

Featured job

Find your next job