SEC charges E*Trade, 5 others, for front running

http://www.reuters.com/article/marketsNews/idINN0530515020090305?rpc=44

by tortilla • 17 years ago

19 9 17 years ago

reuters.com

vaksel• 17 years ago

Seems like a very small fine. I'm sure eTrade made a ton more money than the 34 million they were charged.

gaika• 17 years ago

Just think how much they will lose in customer trust because of that. I pulled everything out today.

chris112• 17 years ago

Yeah. I'm willing to forgive most blunders, and I am not actually investing in the stock market yet. But when I do I'd highly doubt that I'd ever E trade.

ojbyrne• 17 years ago

It seems to me that class action suits would be next, since customers would have to had to pay more for stocks based on these transactions.

ggruschow• 17 years ago

I doubt it. E*Trade's traders ("specialists") on CHX & Cinci weren't really making that much.

falsestprophet• 17 years ago

Who do they think is fooled by neither admitting or denying the allegations?

chris112• 17 years ago

They are getting hit hard for this. Their stock has lost over 13% of its value today.

thinkcomp• 17 years ago

I got a letter from the Office of Thrift Supervision today confirming receipt of my complaint about E*TRADE Bank. Glad to know I'm not the only one who hates them.

mdd• 17 years ago

The article doesn't fully explain "front running", so here's Wikipedia's take: (http://en.wikipedia.org/wiki/Front_running)

Front running is the illegal practice of a stock broker executing orders on a security for its own account while taking advantage of advance knowledge of pending orders from its customers. When orders previously submitted by its customers will predictably affect the price of the security, purchasing first for its own account gives the broker an unfair advantage, since it can expect to close out its position at a profit based on the new price level. Front running may involve either buying (where the broker buys for their account, driving up the price before filling customer buy orders) or selling (where the broker sells for its own account, driving down the price before filling customer sell orders).

SEC charges E*Trade, 5 others, for front running

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