Mar. 12, 2023
Re: Order Competition Rule S7-31-22 Dear Sir or Madame, Investors should have access to the equal and best quotes available in the national market system and such prices generally should be determined by competitive market trading. It shouldn’t be possible to pay billions of dollars for retail orders for the ability to control everything in that entire market. This is the definition of what a current state Market Maker does currently (Citadel). Citadel recommended withdrawing this proposal for a number of reasons, including the unprecedented nature of requiring certain market participants to utilize a specific trading protocol. Sending retail orders to a wholesaler to be internalized is a specific trading protocol that should be removed. A wholesaler such as Citadel who has been front-running customer orders since 2006 shouldn’t have a monopoly on retail order flow. My only concern is that brokers will start charging outrageous commissions or fees in lieu of PFOF, so I’d recommend a cap on the amount of commissions or fees that the brokers are allowed to charge. I trust the Economic Analysis done by the commission and I look forward to retail saving from $1.12 billion to $2.35 billion on transaction costs. These estimated gains would be generated primarily through increased competition to supply liquidity to marketable orders of individual investors, which in turn would lower transaction costs for individual investors, potentially enhance order execution quality for institutional investors, and improve price discovery. The SEC Historical Society has a Youtube video titled Regulation and Market Structure from ATS to NMS published June 1 2018. At 35:09, Dr. Richard R. Lindsey, division director from 1995 - 1998 states “Really what you wanted was competition in the marketplace. And that competition really regulated markets much better than the SEC could. We didn't view it as our job to design the market, we viewed it as our job to try to allow more competition to exist.. To let competition exist you actually have to remove the barriers to competition that exist”. I, along with hundreds of thousands of others, agree with this. One barrier to competition is the conflicted nature of PFOF. Also let me remind you that Bernie Madoff ran PFOF religiously and everyone considered him a bad apple, yet this practice is STILL ALLOWED to this day. Thank you for doing the right thing.