WSJ: Virtu puts IPO on hold


Virtu Financial (VIRT) has suspended its IPO plans amid market volatility and controversy about high-speed trading (HFT) firms after Michael Lewis accused them of rigging the market in a new book, the WSJ reports.

Virtu's move also comes as regulatory scrutiny on HFT increases, with the SEC, FBI, and the state of New York investigating the sector. Virtu has received a letter from the latter's Attorney General's office asking for information about its trading operations

Virtu had intended to raise over $200M in its IPO at a market cap of about $3B and hoped its shares would debut by mid-April.

ETF: IPO

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Comments (6)
  • Patent News
    , contributor
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    a criminal investigation should be complete before they IPO
    18 Apr 2014, 06:04 AM Reply Like
  • Equitable Research
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    Indictments wouldn't surprise me here, in fact I'd be surprised if there was no criminal charges. I think the company is expecting this, hence the suspended IPO. I'm sure that the underwriters have run away as quick as they can to avoid the coming dragnet. If I was a betting man, I would bet that the investigation was underway long before Michael Lewis' book got published or the 60 minutes episode aired. Likely the NY US Attorney's Office (which is the most aggressive in the world against financial crimes) has been on their trail for years and its just a matter of how to best formally present it to a Grand Jury. Definitely geniuses behind this company, but nobody would argue that Maddoff or Skilling weren't geniuses either. All of them are heinous criminals and I'm willing to bet that the dangerous combination of egos and greed among Virtu executives is well documented by the FBI in more wiretaps than anybody can count, clearly building the case for a criminal conspiracy. Market integrity must be protected above everything and the entire Virtu operation is predicated around manipulating and destroying the sanctity of this.
    18 Apr 2014, 02:44 PM Reply Like
  • thodoris91
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    They should never IPO. They should be banned or better go to jail
    18 Apr 2014, 06:56 AM Reply Like
  • Patent News
    , contributor
    Comments (1474) | Send Message
     
    It is called an investigation for a reason. You would be a brilliant investigator! Ha not.
    18 Apr 2014, 10:34 AM Reply Like
  • Michael Reilly
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    I wonder how much scalping they can do by front running everyone else on their own IPO?
    18 Apr 2014, 08:15 AM Reply Like
  • Equitable Research
    , contributor
    Comments (2207) | Send Message
     
    The Virtu business model is awfully similar to the Wiseguys ticket brokers, who were ultimately criminally indicted:

     

    http://wrd.cm/1eR0jYI

     

    Both used technology to exploit a loop hole in an automated market and make a lot of money by scalping.
    18 Apr 2014, 02:07 PM Reply Like
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