Virtu Financial Sues SEC over Failed FOIA Requests

Virtu Financial Inc (Nasdaq: VIRT) has launched a lawsuit against the Securities and Exchange Commission (SEC), which oversees the securities market in the United States.

Announced on Tuesday, the lawsuit is based on the Freedom of Information Act (FOIA). It aims to compel the federal regulator to provide information about its rulemaking process and the interaction of 'interested parties' with SEC Chair Gary Gensler.

“We do not take lightly the step of suing our primary regulator, but it has become clear that the Chair of the SEC is more focused on politics and regulation Regulation Like any other industry with a high net worth, the financial services industry is tightly regulated to help curb illicit behavior and manipulation. Each asset class has its own set of protocols put in place to combat their respective forms of abuse.In the foreign exchange space, regulation is assumed by authorities in multiple jurisdictions, though ultimately lacking a binding international order. Who are the Industry’s Leading Regulators?Regulators such as the UK’s Financial Conduct Authority ( Like any other industry with a high net worth, the financial services industry is tightly regulated to help curb illicit behavior and manipulation. Each asset class has its own set of protocols put in place to combat their respective forms of abuse.In the foreign exchange space, regulation is assumed by authorities in multiple jurisdictions, though ultimately lacking a binding international order. Who are the Industry’s Leading Regulators?Regulators such as the UK’s Financial Conduct Authority ( Read this Term by innuendo and hypothesis than earnestly engaging with an industry that has created the most fair and competitive equity markets for retail investors globally,” said Virtu’s Chief Executive Officer, Douglas Cifu.

Lack of Transparency Led to Lawsuit

Virtu, an electronic market maker, submitted a FOIA request to the SEC last June for details about the new proposals for retail stock order handling and execution Execution Execution is the process during which a client submits an order to the brokerage, which consequently executes it resulting in an open position in a given asset. The execution of the order occurs only when it is filled. There is typically a time delay between the placement of the order and the execution which is called latency.In the retail FX space, reliable brokers always strive to deliver best execution to their clients in order to maintain a solid business relationship with them. This is a co Execution is the process during which a client submits an order to the brokerage, which consequently executes it resulting in an open position in a given asset. The execution of the order occurs only when it is filled. There is typically a time delay between the placement of the order and the execution which is called latency.In the retail FX space, reliable brokers always strive to deliver best execution to their clients in order to maintain a solid business relationship with them. This is a co Read this Term. It wanted to determine whether the regulator’s rulemaking process included the legally required evaluation of potential investor harm and market risks. Furthermore, the company wanted to know if the regulator sourced feedback from ‘broad’ sources and whether it had considered objected data.

The FOIA information would have revealed details of the SEC’s consultation with the industry and the nature of meetings and data that influenced the rulemaking proposals.

However, the SEC failed to produce any single response even after about six months of “detailed and compelling FOIA requests” by Virtu. The company took the regulator to court over concerns about concealing basic information on the rulemaking process.

“FOIA requests are highly routine in nature and among the important rules and procedures that provide a check on government, yet the Chair’s delays and lack of transparency raise serious concerns,” Cifu added.

The SEC is yet to release any official statement on the lawsuit against it.