TD Ameritrade is a retail brokerage that owes a duty of “Best Execution” to its customer clients. That means it is required to route its customers’ orders to the trading venue (i.e. stock exchange) that provides the best price improvement. But rather than find the best venue for its customers’ trades, it routed its customers’ trades to the venue that was most advantageous to TD Ameritrade, who often received kickbacks and fees for routing huge numbers of trades to specific venues, regardless of whether than venue provided “Best Execution” for its customers.
In the three years preceding the lawsuit, TD Ameritrade received more than $600 million in payments for its customers’ order flow. This class action litigation on behalf of TD Ameritrade’s customers is ongoing.
