I refer to your correspondence to ASIC of 11 May 2010 and 28 May 2010, respectively in which you raise concerns about the practice of algorithmic trading in general, as well as the impact of such trading on Alliance Resources Limited (ASX:AGS).
ASIC values the information we receive from the public, and complaints such as yours assist ASIC in working to build confidence in the integrity of the capital markets. ASIC conducts an assessment of every complaint we receive. The issues you have raised will receive careful consideration, and have been recorded on our internal intelligence database.
In determining which matters we will select for further action, consideration is given to the availability of evidence, and a range of factors, including the likely regulatory effect of any available action.
As ASIC is precluded from commenting on operational matters, we are unable to provide further details regarding what, if any, action we may or may not take in relation to the concerns you have raised. If you require any information on our role as a market supervisor, or enforcement action taken by ASIC, please visit ASIC's website at www.asic.gov.au.
Algorithmic trading
ASIC notes your comments in relation to the practice of algorithmic trading and your request that steps be taken to eliminate the practice.
As the market regulator, ASIC is responsible for the supervision of operators of market participants, financial markets and clearing and settlement facilities. While ASIC may advise the Australian Government on matters concerning the regulation of Australia's capital markets, it is not a law reform body.
As such, to the extent that you suggest that ASIC enact legislative reforms in relation to algorithmic trading, we advise that this is a function carried out by the Australian Government and Treasury. As I undestand it, you have prepared a submission to your local member of parliament in this regard.
Please note that ASIC will only contact you again in relation to your complaints if we require further information or evidence to assist in our enquiries.
Yours sincerely Romina
Romina Dein Misconduct & Breach Reporting Stakeholder Services
