Securities Lawyers Blog
We represent clients of financial advisors and brokerage firms in investment disputes against their firms, such as Two Sigma Securities, LLC. Our services cover a wide spectrum of broker misconduct, including unsuitable investments, failure to supervise, and losses in various investment products. Our firm can analyze your brokerage accounts, determine the extent of your investment losses, and understand the issues and remedies available.
Two Sigma Securities is a broker-dealer that primarily engages in market making in equity securities and proprietary trading in equities and futures on various exchanges, and it also executes equity orders as agent for its affiliate Two Sigma Execution Services. Organized as a Delaware limited liability company in 2008 and headquartered on Avenue of the Americas in New York City, the firm is ultimately owned by Two Sigma Capital Markets and acquired the United States options market-making business of Interactive Brokers in 2017.
Two Sigma Securities, LLC – By the Numbers:
- CRD #: 148960
- Regulatory Events: 18
- Broker Employees: 120
Two Sigma Securities, LLC – In the News:
FINRA v. Two Sigma Securities, LLC (Case #2018059615001) – On May 29, 2018 (the “Relevant Period”), the Firm failed to correctly calculate its net long position and, as a result, over-tendered shares in excess of its net long position when participating in the partial tender offer for ABC Corporation (“ABC”). As a result, the Firm’s over-tender of shares violated Rule 14e-4 promulgated pursuant to the Securities Exchange Act of 1934, as amended (“SEA Rule 14e-4”) and FINRA Rule 2010.
FINRA v. Two Sigma Securities, LLC (Case #2016050929001) – On July 11, 2016, the Firm self-reported to FINRA Market Regulation staff that it had discovered certain system issues impacting the Firm’s calculation of available securities for purposes of complying with the requirements of Rule 203(b)(1) of Regulation SHO pursuant to the Securities Exchange Act of 1934 (also known as the “locate” requirement) for approximately two years. After discovering the issues on May 5, 2016, the Firm halted impacted trading on May 6, 2016. The Firm resumed trading on May 11, 2016 for all but Threshold Securities, and then resumed trading in Threshold Securities in December 2016 upon respectively fixing the issues detailed below. From March 21, 2014 to May 5, 2016 (the “review period”), the Firm effected certain short sale transactions detailed below without borrowing, or entering into a bona-fide arrangement to borrow the securities, or having reasonable grounds to believe they could be borrowed, by the delivery date of such securities contrary to the requirements of Rule 203(b)(1). The violations were attributable to issues related to the Firm’s centralized system used to compute the amount of securities available for locate purposes (the “Locate System”). The Locate System issues, detailed further below, caused the Firm to incorrectly calculate its net position in one aggregation unit and fail to distinguish between Threshold and non-Threshold Securities in two aggregation units for locate compliance purposes. Further, the Firm failed to establish and maintain a supervisory system, including written supervisory procedures, reasonably designed to achieve compliance with Rule 203(b)(1). Based on the foregoing, the Firm violated Rule 203(b)(1) of Regulation SHO, NASD Rule 3010 and FINRA Rules 3110 and 2010.
FINRA v. Two Sigma Securities, LLC (Case #2013039165804) – In Review Nos. 20130391658 and 20140409338, FINRA’s Department of Market Regulation reviewed the firm’s compliance with Rule 15c3-5 of the Securities Exchange Act of 1934 (the market access rule) and related supervisory requirements during the period from August 9, 2012 through April 9, 2014, on behalf of FINRA and several exchanges. The reviews found that the firm had inadequate risk management controls and supervisory procedures pertaining to certain aspects of market access, contrary to the requirements of Rule 15c3-5, NASD Rule 3010, and FINRA Rule 2010. A related review on behalf of Nasdaq concerned the firm’s trading in a stock on June 8, 2015, when the firm submitted a clearly erroneous filing with Nasdaq in that symbol.
Our attorneys have successfully represented hundreds of investors in investment disputes with their brokers and brokerage firms. Our consultations are free and we welcome all inquiries.