Thomson Reuters in Stock Market "Fair Play" Dispute

Eagan-based Thomson Reuters found itself in regulatory hot water Monday when New York State Attorney General Eric T. Schneiderman asked the company to stop a practice he said "undermines fair play in the markets."

Thomson Reuters produces critically important consumer confidence surveys twice a month, and had been giving certain paying clients access to the data two seconds before it was released to all other paying clients and to the general public, according to the Los Angeles Times. The surveys are released to reporters at 9:30 a.m., to all paying clients at 9:55 a.m., and to the general public at 10 a.m.

Such a minuscule amount of time may seem insignificant, but—as WIRED magazine explained in detail a few years ago—because the financial markets rely heavily on complicated computer programs to do most stock trading, fortunes can be made in the blink of an eye.

"That two-second advantage is more than enough time for these traders to take unfair advantage of their early access to this information as they execute enormous volumes of trades in the blink of an eye," Schneiderman's office told the LA Times. “The securities markets should be a level playing field for all investors and the early release of market-moving survey data undermines fair play in the markets." 

In response, the AP reports, Thomson Reuters agreed to Schneiderman's request.

The company maintained it had done nothing wrong and had been transparent with its customers.

"It is widely understood that news and information companies compete for exclusive news and differentiated content to help their customers make better informed trading and investment decisions," a Thomson Reuters statement given to the AP said.

Read more on the LA Times and on the Huffington Post.