Attorney General Eric Holder said Friday that the Justice Department is investigating high-frequency trading to determine if it violates insider trading laws.
“The Department is committed to ensuring the integrity of our financial markets—and we are determined to follow this investigation wherever the facts and the law may lead,” Holder said in prepared remarks Friday for a hearing of the House Appropriations subcommittee that oversees the Justice Department.
High-frequency trading is when financial institutions, traders or brokers use sophisticated computer algorithms and high speed data networks to make lightning fast trades. For the Justice Department to find it illegal, it would have to establish that the traders are buying or selling a security while in possession of nonpublic information about the product.
The Federal Bureau of Investigation said earlier this week that it too is probing high-frequency trading. New York Attorney General Eric Schneiderman, the Commodity Futures Trading Commission and the Securities and Exchange Commission are also looking into the practice.
The debate has gained increased public momentum—and some angry finger-pointing—due to Michael Lewis’ new book Flash Boys: A Wall Street Revolt, which alleges that the stock market is rigged against the average investor in favor of high-speed traders at hedge funds and investment banks. In the past week, the New York Times published an excerpt of the book and CBS’ 60 Minutes featured Lewis on its program.
More Must-Reads From TIME
- East Palestine, One Year After Train Derailment
- How Tech Giants Turned Ukraine Into an AI War Lab
- In the Belly of MrBeast
- The Closers: 18 People Working to End the Racial Wealth Gap
- How Long Should You Isolate With COVID-19?
- The Best Romantic Comedies to Watch on Netflix
- Taylor Swift Is TIME's 2023 Person of the Year
- Want Weekly Recs on What to Watch, Read, and More? Sign Up for Worth Your Time
Contact us at email@example.com