Mar. 29, 2023
Dear SEC, I am writing to express my support for the proposed amendments to Regulations NMS and Best Execution under SEC File Numbers S7-30-22 and S7-32-22. I appreciate the SEC's efforts to update Regulations NMS and Best Execution to reflect the current market landscape and address emerging issues such as the rise of high-frequency trading and the impact of market data fees on investors. The proposed amendments to Regulation NMS, including the requirement for public data feeds to reflect the actual speed and cost of trading, will enhance transparency and help investors make more informed decisions. The proposed amendments to Best Execution will also promote fair and efficient markets by ensuring that brokers prioritize the best execution of their clients' orders. However, I urge the SEC to carefully consider the impact of PFOF on our markets... I believe that payment for order flow poses significant dangers to investors and market integrity - Payment for order flow creates conflicts of interest between brokers and their clients, as it incentivizes brokers to route orders to market makers that pay the highest rebates, rather than seeking the best execution for their clients. This can result in inferior execution quality, higher trading costs, and reduced liquidity for investors. Moreover, payment for order flow can distort market competition by favoring large market makers who can afford to pay higher rebates, while smaller market makers are at a disadvantage. This can lead to market concentration and reduced innovation, which can harm market efficiency and investor protection. Wasn't PFOF created by Bernie Madoff? It shouldn't be regulated more, it should be flat out abolished. Other countries don't allow it, why do we? Is this one of those components that allows us to claim other countries "envy" our markets? It's a dishonest business model at best, and at worst (which it actually is) is a Ponzi Scheme. Getting PFOF out of our markets is a MUST. In conclusion, I strongly support the proposed amendments to Regulations NMS and Best Execution and believe that they will improve market quality and enhance investor protection. However, I also urge the SEC to consider the risks associated with payment for order flow and take appropriate measures to mitigate these risks (e.g. Cut it out like the cancerous tumor that it is.) Thank you for considering my comment. Sincerely, Bmo