According to the law firm press release, Barclays provides various financial products and services worldwide. The company primarily operates in UK Retail and Business Banking; Europe Retail and Business Banking; Africa Retail and Business Banking; Barclaycard; Investment Bank; Corporate Banking; and Wealth and Investment Management segments.
The Complaint alleges that throughout the Class Period, Defendants made false and/or misleading statements, and failed to disclose material adverse facts regarding the Company's operation of its dark pool. Specifically, during the Class Period, Defendants made false and/or misleading statements and/or failed to disclose that: (i) Barclays engaged in a "systematic pattern of fraud and deceit" by using its dark pool to favor high-frequency traders over its other clients; (ii) the pools were promoted as offering investors protection from predatory traders, while Barclays instead courted HFT firms by charging them lower rates; (iii) Barclays falsely understated the percentage of aggressive HFT activity in its dark pool; (iv) Barclays failed to provide monitoring services it promised to investors which would protect the dark pool from aggressive, predatory HFTs; (v) Barclays routed a disproportionately high percentage of client orders to its own dark pool while falsely representing that it routed client orders in a manner that did not favor Barclays LX; (vi) Barclays secretly gave HFT firms informational and other advantages over other clients trading in the dark pool; (vii) Barclays' practices subjected it to regulatory scrutiny and significant reputational harm; (viii) and as a result of the above, the Company's financial statements were materially false and misleading at all relevant times.
On June 25, 2014, the New York State office of the Attorney General ("NY AG") issued a press release announcing a lawsuit against Barclays, arising from the operation of Barclays' dark pool and other aspects of its electronic trading division.
The press release stated, in part, that "[T]he complaint alleges Barclays has dramatically increased the market share of its dark pool through a series of false statements to clients and investors about how, and for whose benefit, Barclays operates its dark pool. Contrary to Barclays' representations that it has implemented special safeguards to protect clients from "aggressive" or predatory high-frequency traders, Barclays is accused of operating its dark pool to favor high-frequency traders."
On this news, Barclays' securities fell $1.16, or 7.38%, on extraordinarily heavy volume, to close at $14.55 on June 26, 2014.
On October 2, 2014, the Court appointed lead plaintiff and approved lead counsel. Lead Plaintiff filed an amended complaint on December 15.
A Second Amended Complaint was filed on May 27, 2015.
On February 2, 2016, the Court issued an Order granting Plaintiff's motion to certify class. On June 15, Defendants filed a Notice appealing the Court's Order certifying the class. On May 3, 2018, the Court of Appeals issued an Order affirming the decision of the District Court.
On January 28, 2019, the parties entered into a Stipulation of Settlement. The Court issued an Order preliminarily approving the Settlement on February 4. On June 3, the Court granted final approval of the Settlement and entered Final Judgment.