High-Speed Trading to Be Examined by Levin at Hearing Next Week

Photographer: Andrew Harrer/Bloomberg

Senator Carl Levin, a Democrat from Michigan and chairman of the Senate Permanent Subcommittee on Investigations. Levin sent letters in April to the Securities and Exchange Commission and Commodity Futures Trading Commission asking 13 questions on the effects, trends, concerns and regulatory reaction related to high-frequency trading. Close

Senator Carl Levin, a Democrat from Michigan and chairman of the Senate Permanent... Read More

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Photographer: Andrew Harrer/Bloomberg

Senator Carl Levin, a Democrat from Michigan and chairman of the Senate Permanent Subcommittee on Investigations. Levin sent letters in April to the Securities and Exchange Commission and Commodity Futures Trading Commission asking 13 questions on the effects, trends, concerns and regulatory reaction related to high-frequency trading.

High-frequency trading will face high-profile scrutiny next week when exchanges, brokerages and institutional investors come before a Senate panel looking for evidence of conflicts of interest in U.S. stock markets.

The Permanent Subcommittee on Investigation, led by Senator Carl Levin, is holding a June 17 hearing to examine the impact of conflicts on consumer confidence, he said in a statement yesterday. The panel will focus on how brokers balance the obligation to give customers best execution against services they provide for other brokers and trading venues, according to the statement.

Lawmakers are increasing pressure on regulators and prosecutors to rein in computerized and algorithmic traders who account for about half of U.S. stock trades. Traders like those highlighted by Michael Lewis in his book “Flash Boys” have been linked by critics to a May 2010 stock-market disruption and volatility during the European debt crisis.

Man, Machine and the U.S. Stock Market

Levin, a Michigan Democrat, sent letters in April to the Securities and Exchange Commission and Commodity Futures Trading Commission asking 13 questions on the effects, trends, concerns and regulatory reaction related to high-frequency trading. A witness list for the hearing will be provided later, the committee said.

To contact the reporter on this story: Cheyenne Hopkins in Washington at chopkins19@bloomberg.net

To contact the editors responsible for this story: Maura Reynolds at mreynolds34@bloomberg.net Gregory Mott, Anthony Gnoffo

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