THE ETHICS REPORTER

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Maine Investor Alert

Citadel Securities and Maine Investors: What You Need to Know

Payment for order flow — the practice by which Citadel Securities pays discount brokers for exclusive access to retail order flow — affects an estimated 230,000 Maine retail investors. Here is what Maine residents need to know.

How PFOF Affects Maine Investors

Maine's large retiree and fishing industry populations include many retail investors managing savings through national discount brokers, all subject to undisclosed PFOF practices.

The Scale in Maine

Maine has an estimated 230,000 Maine retail investors. 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.

Maine's financial hub in Portland has sophisticated financial professionals who understand these dynamics. But most Maine retail investors — those in Bangor, Augusta 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 Maine

Kenneth Griffin has given contributions to Senator Collins and national Republican organizations. His key recipients include Senator Susan Collins, a member of the Senate Commerce Committee, and national Republican organizations. 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 Maine.

  • Susan Collins (R-ME Senate) — $10,000 (2020, U.S. Senate)
  • National Republican Senatorial Committee — $1,000,000 (2020, Federal Super PAC)

What Maine Regulators Could Do

Maine Attorney General Aaron Frey and the Maine Office of Securities have authority under the Maine Uniform Securities Act (32 M.R.S.A. §10101 et seq.) to investigate broker-dealer conflicts.

What Maine Investors Can Do Now

Maine retail investors who believe they have been harmed by PFOF-driven execution quality degradation can take several steps:

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