Attorney General Reaches Agreement with Scottrade
in Investigation of Retail Securities Brokerage Industry
HARTFORD – Attorney General George Jepsen today announced an agreement with online retail broker Scottrade, Inc. as part of a multi-state investigation into potential violations of antitrust law in the retail securities brokerage industry.
The investigation focuses on possibly collusive conduct by several retail securities brokers and firms that assist the brokers in executing their orders on an exchange, which may have hindered competition in the retail brokerage industry.
Scottrade agreed to cooperate with the inquiry and in any legal actions that may result. The company also agreed to create and implement an antitrust compliance policy and training program for all Scottrade employees. In exchange, Connecticut and its partner states have closed their investigation into Scottrade and its employees.
“I am committed to ensuring open and competitive markets for all investors, regardless of the size of their portfolio, as well as a level playing field for businesses that provide services to those consumers.” Attorney General Jepsen said. “This investigation is important to achieving those goals.”
Jepsen credited Scottrade for the company’s early cooperation as well as its “commitment to provide better guidance to employees on competition issues.”
The multi-state investigation began shortly after NASDAQ OMX Corporate Solutions, Inc. and Loyal3 Holdings, Inc. discontinued the partnership they had announced on June 2, 2011. Loyal3 offers retail investors a fee-free, on-line platform to purchase securities and fractional shares of publicly traded companies directly from the companies themselves, without the need for traditional retail brokers.
Neither Nasdaq nor Loyal3 are the subject of the Attorney General’s investigation.
Attorney General Jepsen is a co-chair of the Antitrust Committee for the National Association of Attorneys General.
The investigation is being led by Assistant Attorney General George W. O’Connell, with Assistant Attorney General Michael E. Cole, chief of the Antitrust Department.