What the Reforms Would Have Done
The SEC's proposed Rule 615 (the Order Competition Rule) would have required brokers to expose a significant portion of retail orders to a competitive auction before routing them to a single market maker. This would have directly undermined the PFOF model by preventing Citadel from paying for exclusive access to retail order flow. The proposal also included reforms to tick sizes, access fees, and transparency requirements that would have reduced Citadel's structural advantages.
Citadel's Opposition
Citadel Securities filed multiple extensive comment letters opposing the reform package. Griffin personally lobbied members of Congress and the SEC commission. Citadel-affiliated political donations increased during the reform debate period. The firm's public relations operation argued that the reforms would harm retail investors — a claim that independent academics and the SEC's own economists largely disputed.
The Outcome
The SEC's market structure reform package was substantially diluted by 2024. The Order Competition Rule was not finalized in its original form. Of the four reform proposals Gensler introduced, only limited elements were ultimately adopted. Critics directly attributed the watered-down outcome to political pressure facilitated by Citadel's extensive lobbying and political giving.
What Comes Next
Under the current political environment, comprehensive market structure reform appears unlikely in the near term. However, state-level enforcement actions, private litigation, and continued investigative journalism represent alternative pressure points. The Ethics Reporter will continue to track regulatory developments.