Mar. 31, 2023
Hello, I am an individual investor who hopes to maintain faith in the US stock market, and so I am writing to support this rule change. This rule has been proposed to prevent Citadel from receiving orders first, requiring them to be sent to a public auction where all parties, including pension funds, have an equal opportunity to fill the order. I believe this will help address the unfair advantage that Citadel has in the current system. Payment for Order Flow (PFOF) has been banned in the UK due to concerns about conflicts of interest, and I believe that the same should be done in US markets. Brokers who do not accept PFOF reportedly route orders differently and achieve better execution quality. A recent study found that Robinhood's use of PFOF does not provide significant price improvement compared to exchanges, despite generating a large portion of its revenue. Retail investors who do not have to rely on PFOF reportedly get better prices than those who do, which seems to violate FINRA's guidance on Best Execution. TD Ameritrade's order-routing decisions are not motivated by competition, despite what the company claims on its website. They pay to get the first look at orders and route them to firms that benefit greatly from the arrangement. I believe that this undermines fair competition and hurts investors. Dark pools, which are alternative trading systems, should be required to provide quotes and trades to consolidated market data to increase transparency in these markets. This would help to address concerns about the lack of visibility in dark pools and the potential for abuses. Wholesalers in the market have too much influence and engage in conflicts of interest. This undermines fair competition and harms investors. I believe removing middlemen from the market will lead to better prices and save billions of dollars for individuals and institutions, such as pension funds. The SEC should investigate conflicts of interest among market participants to ensure that they can objectively review the rules. Additionally, enforcement of SEC rules should be strengthened with higher fines that serve as a deterrent for breaking the law. I am sick of seeing fines for serious financial crimes treated as just another cost of doing business. In some cases, revoking licenses of broker-dealers may be a more effective punishment than issuing fines. When fines are issued, I believe they should be for the full amount gained from the crime, plus a large percentage on top to truly discourage further abuses. The state of American markets has been criticized for being anti-competitive, and fair competition is seen as essential. The proposed rule to bring more transparency to dark markets should be implemented as soon as possible to address concerns about the lack of visibility in these markets. As I said, I hope to retain my faith in my country's market system, and for that I and all Americans deserve to see that the SEC exists to keep the market fair. Please do not cave to pressure from large entities who wish to continue their abuse of the system to the detriment of us all. Thank you. Sincerely, Spencer Worley, NC 27583