On the show last month, we talked about high-speed traders paying thousands of dollars to get access to important data two seconds before the rest of the world.
By most accounts, this is entirely legal. The data are privately collected, and sold to subscribers by Thomson Reuters, a giant information company. Private companies sell data to subscribers all the time.
Still, a delay of just two-seconds is a striking reminder of the rise of automated trading, and the subject got lots of media coverage last month. Today, New York attorney general Eric Schneiderman said he'd persuaded Thomson Reuters to stop releasing the data early. From a Schneiderman press release:
financial information giant Thomson Reuters has agreed to immediately discontinue the practice of providing high-frequency traders with certain market-moving consumer survey results prior to the release of that information to its other subscribers, a move prompted by a current investigation by the Attorney General's office into this matter.
In discussions with Thomson Reuters, Schneiderman's staff cited a "a state law that does not require the government to show proof that a company intended to defraud anyone," according to the Times. "It also allows investigators to seek an enormous amount of information from businesses."
When Eliot Spitzer was AG, he used the same law to investigate Wall Street firms, the Times points out.
Copyright 2021 NPR. To see more, visit https://www.npr.org.