The hunt is on! BATS Global Markets wants to permission to stop shady trading behavior sooner rather than later. In a petition to the Securities and Exchange Commission, the Kansas City-based trading venue asked for a greenlight to implement the BATS Client Suspension Rule, which would allow the trading venue to stop manipulative behavior, such as spoofing and layering, in a more timely manner.
In a press statement, BATS claimed that “[p]ending SEC approval, the BATS Client Suspension Rule would allow BATS to stop ongoing manipulative conduct in a matter of weeks, instead of the lengthier, longstanding regulatory process that can take several years to reach a final resolution. The Rule distinguishes itself by specifically addressing the practices of layering and spoofing via an expedited process.” (BATS’ emphasis.)
While instances of spoofing and other similar activities are limited in the U.S. markets, we believe regulators should have the ability to eradicate such disruptive behavior immediately, said BATS executive vice president and general counsel Eric Swanson. Pending SEC approval, the BATS Client Suspension Rule will allow us to swiftly obtain an order suspending a customers access to the exchange to stop disruptive and manipulative layering and spoofing which we believe is often undertaken by small groups of day traders, often located in foreign jurisdictions, accessing the markets via U.S. broker dealers.”
Swenson added, We are working with our regulatory peers to ensure that all markets have the means to expedite the regulatory process whenever clear evidence of layering and spoofing is identified, he said.
Check out details of the BATS approval here, BATS Client Suspension Rule Filing