North Dakota Investor Alert

Citadel Securities and North Dakota 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 130,000 North Dakota retail investors. Here is what North Dakota residents need to know.

How PFOF Affects North Dakota Investors

North Dakota's oil boom has created a significant population of energy-sector workers with retirement savings — many managed through discount brokers subject to PFOF practices.

The Scale in North Dakota

North Dakota has an estimated 130,000 North Dakota 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.

North Dakota's financial hub in Fargo has sophisticated financial professionals who understand these dynamics. But most North Dakota retail investors — those in Bismarck, Grand Forks 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 North Dakota

Kenneth Griffin has given contributions through national Republican organizations. His key recipients include national Republican organizations that support North Dakota's federal delegation. 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 North Dakota.

Republican National Committee — $1,500,000 (2022, Federal Committee)

What North Dakota Regulators Could Do

North Dakota Attorney General Drew Wrigley and the North Dakota Securities Department have authority under the North Dakota Securities Act (N.D.C.C. Ch. 10-04) to investigate broker-dealer practices.

What North Dakota Investors Can Do Now

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

File a complaint with the North Dakota Securities Department at https://www.nd.gov/securities
File a complaint with the North Dakota Attorney General at https://attorneygeneral.nd.gov
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

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