SEC Probes 'Quote Stuffing' For Link To Market Crash

Law360, New York (September 2, 2010, 3:32 PM EDT) -- The U.S. Securities and Exchange Commission is reportedly examining a Wall Street practice called “quote stuffing” and whether it helped fuel the May “Flash Crash” — when the Dow Jones Industrial Average plummeted 700 points in just minutes.

Specifically, the SEC is looking into whether the practice improperly affects stock prices and gives some investors an inappropriate advantage, the Wall Street Journal reported Thursday, citing unnamed sources familiar with the matter.

“Quote stuffing” involves placing unusually large numbers of orders to buy or sell stocks, only...
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