SEC Plans to Tighten Regs on ‘Dark Pools’ | Courthouse News Service
Friday, December 1, 2023 | Back issues
Courthouse News Service Courthouse News Service

SEC Plans to Tighten Regs on ‘Dark Pools’

WASHINGTON (CN) - The Securities and Exchange Commission on Wednesday proposed plans to tighten regulations on so-called "dark pools," to increase transparency and give investors a clearer view of stock prices and liquidity.

Dark pools are alternative systems to the major stock exchanges that let buyers and sellers to trade without displaying prices to the public. The new plan would require information about an investor's interest in buying or selling a stock be made available to the public instead of just a select group operating within a dark pool. It also would require that dark pools publicly identify that it was their pool that executed a trade.

"We should never underestimate or take for granted the wide spectrum of benefits that come from transparency, which plays a vital role in promoting public confidence in the honesty and integrity of financial markets," said SEC Chairman Mary Schapiro.

The number of active dark pools have tripled since 2002, the SEC said. Given the growth, "a lack of transparency could create a two-tiered market that deprives the public of information about stock prices and liquidity."

The changes must undergo a 90-day public comment period before they can be adopted.

Categories / Uncategorized

Subscribe to Closing Arguments

Sign up for new weekly newsletter Closing Arguments to get the latest about ongoing trials, major litigation and hot cases and rulings in courthouses around the U.S. and the world.