How PFOF Affects Connecticut Investors
Connecticut is home to numerous hedge funds and sophisticated investors in Greenwich and Stamford — but retail investors statewide use the same discount brokers and are subject to the same PFOF practices. The irony is that Connecticut's wealthy financial professionals understand PFOF's harm while ordinary residents are unprotected.
The Scale in Connecticut
Connecticut has an estimated 700,000 Connecticut retail investors — with disproportionate wealth and trading activity given the state's proximity to Wall Street. Each of these investors who uses a PFOF-dependent discount broker — Robinhood, TD Ameritrade, E*Trade, Charles Schwab, or Webull — is routing their orders to Citadel Securities without their knowledge or consent. Citadel captures a spread on each of these trades, generating revenue that flows back to Kenneth Griffin while providing retail investors with marginally inferior execution prices compared to what competitive exchange routing would provide.
Connecticut's financial hub in Greenwich has sophisticated financial professionals who understand these dynamics. But most Connecticut retail investors — those in Stamford, Hartford and throughout the state — are unaware that their "free" trades are funded by a practice that systematically extracts value from them.
Kenneth Griffin's Political Investment in Connecticut
Kenneth Griffin has given millions through national Republican organizations that compete for Connecticut's federal seats. His key recipients include national Republican Senate committees. This political investment creates a documented relationship between the CEO of America's dominant retail market maker and the political figures responsible for overseeing financial regulation in Connecticut.
- National Republican Senatorial Committee — $1,000,000 (2022, Federal Super PAC)
What Connecticut Regulators Could Do
Connecticut Attorney General William Tong has been active in financial consumer protection and could pursue PFOF claims under the Connecticut Unfair Trade Practices Act (CUTPA). The Connecticut Banking Department has securities enforcement authority under C.G.S. §36b-2.
What Connecticut Investors Can Do Now
Connecticut retail investors who believe they have been harmed by PFOF-driven execution quality degradation can take several steps:
- File a complaint with the Connecticut Department of Banking, Securities and Business Investments Division at https://portal.ct.gov/DOB
- File a complaint with the Connecticut Attorney General at https://portal.ct.gov/AG
- File a complaint with the SEC at sec.gov/tcr
- File a complaint with FINRA at finra.org
- Consider switching to a broker that does not use PFOF, such as Fidelity or Interactive Brokers direct routing