Did Nasdaq Go Under The Counter?
THE TRUSTBUSTERS SURE ARE busy. The Justice Dept.'s latest probe is an investigation into allegations that traders in the over-the-counter stock market are fixing prices. Their concern: Investors may be getting burned because market makers use the NASDAQ trading system to inflate the spread between the bid and asked price of stocks. A larger spread means fatter profits for the brokers. NASDAQ trading practices were questioned in a May study by two professors who suggested that collusion might explain the wide gap--at least 25 cents per share--between the bid and the asked prices of stocks. A NASDAQ spokesman said allegations of collusion are unfounded. In early October, Justice confirmed that it also is investigating possible antitrust violations by the auto industry in its dealings with car-rental companies and in the way cars are priced.
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