Deutsche Bank, UBS, and Credit Suisse have regulators asking questions about who they allow to trade in their private stock exchanges. These so-called "dark pools" have grown rapidly in recent years as slower moving institutional investors seek protection from predatory flash traders.
New York Attorney General Eric Schneiderman file a suit alleging Barclays told investors that it had set up safeguards to protect them from predatory high-frequency traders. But it says Barclays actually catered to those traders.
Large institutional investors have long been at the mercy of flash traders who use computers to make thousands of trades a second, skimming off tiny bits of profit from pension and retirement accounts.
For protection fund managers sought out private stock exchanges called dark pools where only certain investors were allowed in.
Think of them like a fish tank for guppies.
"What Barclays is accused of is making promises that they would keep sharks out of the pool but were actually sort of inviting the sharks into the pool."