FINRA Registration

MMI Supports the Registration of HFT Firms with FINRA

The Issue:

On March 25, 2015 the Securities and Exchange Commission proposed rule amendments to require that broker-dealers trading in off-exchange venues become members of a national securities association. The amendments were aimed to enhance regulatory oversight of active proprietary trading firms, such as high frequency traders.

MMI’s Stance:

We support efforts at greater transparency to boost investor confidence in the modern markets. Our Member firms are all registered with the U.S. Securities and Exchange Commission, the CBOE and, through their registration with several exchanges, the Financial Industry Regulatory Authority.

Further Resources:

March 26, 2015: SEC Rules Would Boost Oversight of High-Frequency Firms
The Wall Street Journal article reporting on the SEC’s unanimous vote to require computer-driven trading firms to register with the Financial Industry Regulatory Authority. Adam Nunes, head of business development at MMI Member firm Hudson River, said the rules won’t be a big change for his firm because it is a member of several exchanges that already outsource regulatory functions to Finra.

March 24, 2015: SEC Proposes Rule to Require Broker-Dealers Active in Off-Exchange Market to Become Members of National Securities Association
Press release announcing the Securities and Exchange Commission’s proposed rule amendments to require that broker-dealers trading in off-exchange venues become members of a national securities association.

May 13, 2014: High-Speed Traders Need Oversight, Ex-CFTC Economist Says
Bloomberg News story in which Ari Rubenstein, co-founder and chief executive officer of MMI Member firm Global Trading Systems LLC, said that additional regulatory requirements in commodity markets could help promote investor confidence.

May 13, 2014: Senate Ag Hearing: Highlights Differences Between Futures and Equities Markets
MMI senior advisor Peter Nabicht says when considering registration issues, “it would be much better to categorize a firm based on its actual behavior as evidenced in the data.”

“Main Street is the great beneficiary … We are better off with high-frequency trading than we are without it."

JACK BOGLE, founder Vanguard Group

Moneywatch, April 3, 2014

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