Thomson Reuters Corporation (USA) (NYSE:TRI) has agreed to suspend its practice of releasing certain economic data early to premium clients, due to a probe by New York's attorney general.
The New York-based news and information company is expected to announce Monday that it will no longer release the results of the University of Michigan's consumer-sentiment survey two seconds early to groups that pay extra for the edge.
The attorney general, Eric Schneiderman, is investigating a recent instance when millions of dollars' worth of trades were conducted in milliseconds as traders' computers were fed sensitive data earlier than the official time of release.
Thomson Reuters says it is cooperating with authorities and starting July 12, the twice-monthly report will be released at the same time to all of its money-management clients.
"Promoting fairness and avoiding distortions in the securities markets is an important focus of this office," said Attorney General Schneiderman. "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."
Schneiderman says his office's insistence that Thomson Reuters change its practice removes an unfair advantage that high-frequency traders had by only allowing them access to this market-moving information at the same time that it is made available to other subscribers.
"This change immediately removes a prior distortion in the markets and it sends a message that unfair timing advantages for high-frequency traders and others will not be tolerated by the Attorney General," statement.
Malik Singleton covers manufacturing and other economic news. His previous roles were with City Limits, TIME.com, Black Enterprise and PCMag.com. He is an adjunct at CUNY's...