DoJ Confirms "Insider Trading" Probe Of HFT

Tyler Durden's picture


And all it took for the FBI, the SEC and now the DOJ to figure out the casino was rigged all along, was for a Michael Lewis book to do their job for them.


As WSJ reports,

The Justice Department is investigating high-speed trading practices to determine whether they violate insider-trading laws, Attorney General Eric Holder is expected to tell lawmakers Friday.


Mr. Holder, in prepared remarks, said the practice has "rightly received scrutiny from regulators."


"The department is committed to ensuring the integrity of our financial markets," Mr. Holder said in testimony about the Justice Department's budget before the House Appropriations Committee. "We are determined to follow this investigation wherever the facts and the law may lead."


The Federal Bureau of Investigation said earlier this week that it is probing high-frequency trading. New York Attorney General Eric Schneiderman, the Commodity Futures Trading Commission and the Securities and Exchange Commission are also looking into the practice.

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Fri, 04/04/2014 - 09:39 | 4624555 i_call_you_my_base
i_call_you_my_base's picture

Maybe Holder will deem HFT TBTF and selectively enforce the law.

Fri, 04/04/2014 - 09:41 | 4624575 eclectic syncretist
eclectic syncretist's picture

maybe market volume will plummet now.  And what would happen then?

Fri, 04/04/2014 - 09:45 | 4624590 ArkansasAngie
ArkansasAngie's picture

Why, the market will go up.  Little volume is much easier to manipulate.

Fri, 04/04/2014 - 09:48 | 4624606 bania
bania's picture

Maybe Lewis can write an illustrated version of "Where's Corzine" next?

Fri, 04/04/2014 - 09:55 | 4624622 BaBaBouy
BaBaBouy's picture

Howlder Is Now Involved???

Wow, I Actually Had Hopes Something Would Get Done...

Dream On... Bitchez...

Fri, 04/04/2014 - 09:58 | 4624668 Thought Processor
Thought Processor's picture




What a complete circus this is.

Fri, 04/04/2014 - 09:59 | 4624676 pemdas
pemdas's picture

As an individual investor, here is a HFT issue I see often: 


            I put an order an order in for 5,000 shares at $7.00. They sell me 1 share at $7.00, then step in front and buy 4,999 shares at $7.0001, knowing they can most likely sell to some other retail buyer at $7.01 for a $35 profit, or at worst, if the market turns, sell to me at $7.00 for a 50 cent loss. Nice odds. My only recourse is to cancel my order, but then I end up paying a 100% commission for 1 share of stock.

Fri, 04/04/2014 - 10:35 | 4624778 Rock On Roger
Rock On Roger's picture

You are a speculator, not an investor.

Quit speculating, money for nothing.


Stack On

Fri, 04/04/2014 - 10:49 | 4624824 fonestar
fonestar's picture

If Eric Holder is on the case does this mean he will be delivering HFT servers to Wall St.?  You know, to see if they get used and where they wind up?

Fri, 04/04/2014 - 11:39 | 4625002 Fish Gone Bad
Fish Gone Bad's picture

Let's see, has Holder done anything about MF Global yet?   

Fri, 04/04/2014 - 13:35 | 4625486 SamAdams
SamAdams's picture

Lip Service....  Like Feinstein whining about the NSA spying.  It's just BS politicians use to make it seem like they have the people's interests at heart.  Absolutely nothing positve will result of either of these traitor's words.

Fri, 04/04/2014 - 15:42 | 4626084 macholatte
macholatte's picture



Hand  over some big Campaign Contributions and the Problem Goes Away.

-- Erik the Holdup Man

Fri, 04/04/2014 - 10:49 | 4624826 Dr. Kenneth Noi...
Dr. Kenneth Noisewater's picture

Put in a Fill Or Kill limit order.

Fri, 04/04/2014 - 10:51 | 4624830 I am a Man I am...
I am a Man I am Forty's picture

that's what limit all or nothing orders are for

Fri, 04/04/2014 - 10:10 | 4624706 RafterManFMJ
RafterManFMJ's picture

What a macabre circus this is.


Fri, 04/04/2014 - 10:13 | 4624718 crazzziecanuck
crazzziecanuck's picture

Indeed.  $0.25 and a DoJ investigation let's you use a payphone.  DoJ "investigations" are just busy-work to make it appear they're doing something.

Fri, 04/04/2014 - 10:29 | 4624755 RedHarley
RedHarley's picture

I expect a few FBI raids on the firms of Obama donors to make sure any evidence ends up in the same dustbin as all of the stuff they took at Solyndra.

Fri, 04/04/2014 - 09:59 | 4624673 Bindar Dundat
Bindar Dundat's picture

Something will be done, justice will be served. Brad will be charged for his actions at RBC.  

Fri, 04/04/2014 - 11:21 | 4624934 Blues Traveler
Blues Traveler's picture

The Jinn's media strategy is working nicely, the press can cover this through Nov elections, see the gov does care about the people.  Well actually mr holder, how much money does the HFT actually make on 50 shares of IBM.  You get it, this is not about the Lilliputians, this doesnt impact them. It is something bigger.

Fri, 04/04/2014 - 09:46 | 4624594 Rainman
Rainman's picture

Public pension funds go boom.

Fri, 04/04/2014 - 10:38 | 4624785 Two-bits
Two-bits's picture

Not to worry Rainman, have you heard about the MyRA program?  We can protect your future from deceptive public pension funds, and tuck away your nest egg in safe US Treasuries.  Sign here and the automatic payroll deduction can begin. 


BTW, do you have health insurance?

Fri, 04/04/2014 - 09:43 | 4624580 Two-bits
Two-bits's picture

If now, after sidestepping so many other issues, Holder decides to make something of this, we can know for certain that the collapse is baked into the cake, and that this failed British spin-off is really dead.



Fri, 04/04/2014 - 09:48 | 4624604 jcaz
jcaz's picture

For Holder to sidestep anything, he'd actually have to understand that something is going on-  ain't gonna happen, he's paid to be Sgt Schultz....

Fri, 04/04/2014 - 09:54 | 4624644 Two-bits
Two-bits's picture

Which proves my point.  He is incapable of independant logical thought, and he is directly controlled by his handlers. A sock puppet with googly eyes. 


Fri, 04/04/2014 - 09:55 | 4624652 Winston Churchill
Winston Churchill's picture

More like Inspector Clouseau in blackpaint..

Fri, 04/04/2014 - 10:11 | 4624708 Poundsand
Poundsand's picture

Wrong, it is time to get a big bump in those Democratic election campaign donations.  They were starting to slide and legal extortion is always the best way to go.

Fri, 04/04/2014 - 11:52 | 4625046 SDShack
SDShack's picture

Bingo, I was thinking the same thing. Holder and the 0zer0 administration is just a 3rd world cop, shaking down citizens and businesses with the threat of serious time, just to get more payola to dole out to their sycophants.

Fri, 04/04/2014 - 09:49 | 4624595 Sudden Debt
Sudden Debt's picture

depends on the incentives he'll receive at the HTF kickback meeting he's organising this weekend. Nothing is set yet, let the bidding begin!!


My 2 cents? The HTF will pull the plug for 1 hour, the market will crash and at hour 1.00001 they'll be granted all the inside info and a chair at the FED and continue their business.

Fri, 04/04/2014 - 10:28 | 4624756 Bangin7GramRocks
Bangin7GramRocks's picture

I think that you are right. It would take about an hour for the computers to show who really controls the economy and the investigation would end promptly. Maybe a .5% fine of profits would be a suitable tithe to make it all go away. The big banks just whisper the word derivitives and the gubmint shits its pants. Same thing.

Fri, 04/04/2014 - 09:52 | 4624636 GolfHatesMe
GolfHatesMe's picture

Look the Fuck out!  You didn't tell me you were calling the Wolf!

Fri, 04/04/2014 - 10:11 | 4624711 Jumbotron
Jumbotron's picture

Holder is not going to do shit because there is too much money to be made....not to mention the whole system will more rapidly collapse in the coming years once you eliminate HFT or severely restrain it due to regulations. 

This is just to scare the rogues in the system to go underground and be smarter so as not to embarrass the SEC any further......and to not take any more time away from their porn watching activities.

Fri, 04/04/2014 - 10:36 | 4624781 EverythingEviL
EverythingEviL's picture

What a fucking joke.  Like those assholes haven't known about this shit for years and they aren't all in on it.  They tweet out a bunch of shit like now they are going to do something about it because a book has made it public knowledge.  Fuck all of em.  This will be backpage news in a couple days for the mainstream again and they can go back to business as usual

Fri, 04/04/2014 - 13:22 | 4625430 sgt_doom
sgt_doom's picture

And all it took for the FBI, the SEC and now the DOJ to figure out the casino was rigged all along, was for a Michael Lewis book to do their job for them.

What total bullcrap:  the point of Lewis' book is to focus ALL the attention on that small sliver of how the market is rigged, instead of publicizing the majority of the true rigging:

their internalization business, or how the top brokerages funnel 100% of their retail stock sales/trades, almost every day, to the top banks and hedge funds, where they do the matching, and have all the knowledge of said retail stock trades, on their internal systems (hence they are called the internalizers), also known as "dark pools."

(Plus, there's the DTCC's Stock Borrow Program, which allows for virtual naked shorting of stocks.)

The purpose of all of Mikey's books are to refocus or redirect away from the serious stuff, his book on the financial meltdown concentrated on the subprime market, pretty much to the exclusion of all else, the really important stuff, which would have put the banksters away for life.

Speaking of those banksters, the DOJ invokved the Law of Fraudulent Conveyance against an oil corporation for financial machinations to avoid paying fines --- all correct --- but the very same law is what all the banksters violated and could just have easily been used against them (as Prof. Michael Hudson [] remarked upon long ago!

Fri, 04/04/2014 - 09:41 | 4624569 digitlman
digitlman's picture

5 years too late, fucking Place Holder.

Fri, 04/04/2014 - 09:46 | 4624593 dow jones 20000
dow jones 20000's picture

does this explain why the S&P just pooped itself?

Fri, 04/04/2014 - 09:51 | 4624628 Sudden Debt
Sudden Debt's picture

well... whenever a comet will hit earth, let's how we see it 20 years in advance...

they'll probably even first IPO it as a metal mine before they'll even call it a comet...

Fri, 04/04/2014 - 09:41 | 4624571 Dr. Richard Head
Dr. Richard Head's picture

Aren't they investigating the IRS for going after "conservative sheep groups", Benghazi, torture, NSA warrantless wiretapping, gun running, drug money laundering, etc, etc.?  Yeah, bury it all in an investigation and continue the fleecing and murdering.

Fri, 04/04/2014 - 11:57 | 4625063 SDShack
SDShack's picture

I heard Holder is going to appoint John Corzine as Special Prosecuter to investigate HFT.

Fri, 04/04/2014 - 13:52 | 4625532 Tale2cities
Tale2cities's picture

Yea and Obama said right after the IRS scandal broke "But I have got no patience with it, I will not tolerate it, and we will make sure that we find out exactly what happened on this,"
IRS responds it will take years too respond accurately to congressional requests for LLearner emails,etc.
You know,we can't talk about it because "there's an ongoing investigation"
Yea keep those investigations open forever,and never allow the truth to emerge. I hate all of those DC fuckers

Fri, 04/04/2014 - 09:42 | 4624577 firstdivision
firstdivision's picture

HFT was really a small time game compared to the Insider Trading still going on by banks.  Oh wait, I forgot, the "Chinese Wall" prevents IBD and Prop from talking...

Fri, 04/04/2014 - 13:23 | 4625441 sgt_doom
sgt_doom's picture

Thanx, firstdivision, you are exactly on target!

Fri, 04/04/2014 - 09:42 | 4624579 Fix-ItSilly
Fix-ItSilly's picture

Insider trading?  Are they really going to indict the exchanges who provided different update rates on quotes when bribed?

Fri, 04/04/2014 - 13:26 | 4625452 sgt_doom
sgt_doom's picture

Well . . . since all the financial exchanges and clearinghouses are owned by the banks and their oil companies, it seems highly unlikely, but should it be so, it will be done in such a manner that the exchanges get their fines back --- business as usual.

Fri, 04/04/2014 - 09:44 | 4624582 HRamos_3
HRamos_3's picture

I'm pretty sure that the facts and the law will only lead to extra monies in Place Holder's pocket. So yea, bullish.

Fri, 04/04/2014 - 09:45 | 4624587 Ban KKiller
Ban KKiller's picture

Holder is a coward who is bought and paid for. Wall Street will stay rigged as the greedy are rewarded. Is Greenwich fire proof?

James Madison was a revolutionary at 23. 

Fri, 04/04/2014 - 09:46 | 4624596 SheepDog-One
SheepDog-One's picture

AH I in other words it will all be swept under the rug.

Fri, 04/04/2014 - 09:47 | 4624597 Bearwagon
Bearwagon's picture

Probing? Like, with one of these famous anal-probes, usually said to be used by aliens?

Fri, 04/04/2014 - 09:47 | 4624598 Shrapnel
Shrapnel's picture

Now that Holder is on the case, I definitely expect nothing to change.

Fri, 04/04/2014 - 09:47 | 4624603 Sven Sikztu
Sven Sikztu's picture

the algos are trembling in their databases

Fri, 04/04/2014 - 09:51 | 4624605 Dr. Engali
Dr. Engali's picture

"And all it took for the FBI, the SEC and now the DOJ to figure out the casino was rigged all along, was for a Michael Lewis book to do their job for them"


They knew it was rigged all along, and they embraced it because the robots helped churn the "market" higher. The book doesn't have a thing to do with their current actions. It would not have seen the light of day if the .gov MSM propaganda machine didn't have something up their sleeve.

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