Regulators send subpoenas to high-frequency traders: report
The U.S. securities regulator has sent subpoenas to high-frequency trading firms in relation to last year's flash crash probe, the Wall Street Journal reported, citing people familiar with the matter.
The Securities and Exchange Commission (SEC) is also examining whether these firms further exacerbated the panic on May 6, 2010, when U.S. stock markets suffered a record fall within minutes, the Journal said.
The sudden drop in stock prices on that day is referred to as flash crash.
Some of the subpoenas have been sent since the start of the summer, the people told the Journal. The paper did not name the firms involved.
It is not known whether the subpoenas will result in any enforcement actions, the paper said. A subpoena does not necessarily reflect a suspicion of wrongdoing.
The practice of high-frequency trading involves deployment of rapid-fire machines that place thousands of very short-term bets, making markets and profiting on tiny price imbalances.
The SEC could not immediately be reached by Reuters for comment outside regular U.S. business hours.
(Reporting by Sakthi Prasad in Bangalore; Editing by Vinu Pilakkott)
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