Credit Suisse Group AG: Trading in Dark Pools and Misleading Investors

Authors
Sun, J., Xia, Q., O'Rourke, J. S. (editor)
Region
North America
Topic
Strategy & General Management
Length
12 pages
Keywords
regulation
fines
management
Market Share
stock price
Copyright Holder
Notre Dame
Student Price
$4.00
Target Audience
Graduate Students
Undergraduate Students

Under the increasing regulation environment pushed by the SEC toward dark pools, Credit Suisse’s two dark pools, Crossfinder and Light Pool, were charged fines of $84.3 million in total. The management in Credit Suisse were facing the loss of dark pool market share and declining stock price.

Learning Outcomes
  1. To highlight the conflict that arises as a company attempts to balance the need to earn profits with the responsibility of protecting client rights;
  2. To illustrate how a controversial mechanism can trigger government authorities to investigate, leading to large fines levied against a group of investment firms;
  3. To probe into the underlying reasons why a financial services company might be motivated to evade US federal regulations and mislead investors;
  4. To encourage discussion of client rights protection by financial services companies.