REUTERS – Market maker Citadel Securities does not use the personal information of retail investors, its billionaire co-founder Ken Griffin told CNBC on Friday, a day after the U.S. congressional hearing on GameStop (NYSE:GME).
During Thursday’s hearing, several lawmakers had raised concerns on whether large market makers had taken advantage of retail investors and if they could pose a threat to the financial system.
Griffin had pushed back against those questions, saying that Citadel Securities, which executes roughly 47% of all U.S.-listed retail volume, had worked for years to help give consumers “a better price.”
A market maker is a broker or dealer who holds a certain amount of securities at hand to facilitate trading, competing for orders by giving buy and sell price quotations, then filling orders rapidly either from its own inventory or an offsetting order.
The retail investor-led rally in heavily shorted stocks earlier this year has raised scrutiny on the information market makers can collect from the order flow.
“There’s been a number of misperceptions about the data that we receive from the retail brokerage community. In fact, a prominent U.S. Senator asked us specifically about what personal identifying information do we receive from retail investors. The answer is none,” Griffin told CNBC.
Friday’s interview allowed Griffin to clear the air after he got cut off repeatedly on Thursday by lawmakers who demanded quick, clear responses.
“This conspiracy theory that we somehow or another are like some of the big tech giants that have access to personal identifying information is just flat out false,” he said on Friday.