FINRA Fines Lightspeed Trading Over “Spooffing” Allegations
The Financial Industry Regulatory Authority (FINRA) fined Lightspeed Trading $250,000 to settle claims the firm was complicit in a scheme whereby several unregistered broker-dealers executed trades and manipulated stock prices through an orchestrated spoofing scheme. As is customary, the broker-dealer agreed to pay the fine to settle the charges without admitting any wrongdoing. FINRA had alleged the firm knew or should have known they were aiding and abetting the illegal operations of the unregistered broker-dealers through an improper commission-sharing agreement.
To facilitate the scheme, each of the unregistered firms had one or more employees registered as a Lightspeed licensed representative. Lightspeed was allowed it to keep a certain portion of the commissions it collected on transactions for the unregistered brokerages, passing the remaining commission on to the registered representative of the unlicensed firm. Commissions ranged between $145,000 and $1.4 million.
The attorneys at Colling Gilbert Wright & Carter are currently investigating Lightspeed Trading and its association with unregistered broker dealers. If you have lost money through this firm or another unregistered broker dealer, you may be entitled to damages. Please contact the experienced securities fraud attorneys at Colling Gilbert Wright & Carter for a free case evaluation.