How PFOF Affects Washington D.C. Investors
DC retail investors — including government regulators, congressional staffers, and policy professionals — have a unique window into the gap between Citadel's political influence and regulatory action. DC residents deserve the same investor protections as residents of the 50 states.
The Scale in Washington D.C.
Washington D.C. has an estimated 150,000 DC retail investors — disproportionately employed in government and policy roles. 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.
Washington D.C.'s financial hub in Washington DC has sophisticated financial professionals who understand these dynamics. But most Washington D.C. retail investors — those in 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 Washington D.C.
Kenneth Griffin has given millions through national Republican organizations with significant DC-based operations. His key recipients include national Republican House and Senate super PACs that fund campaigns competing for DC-adjacent congressional seats. 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 Washington D.C..
- Congressional Leadership Fund — $1,000,000 (2022, Federal Super PAC)
- National Republican Senatorial Committee — $1,000,000 (2022, Federal Super PAC)
What Washington D.C. Regulators Could Do
DC Attorney General Brian Schwalb and the DC DISB have authority under the DC Securities Act (D.C. Code §31-5601.01 et seq.) to investigate broker-dealer practices. DC's unique position as both a political and regulatory center makes its AG a critical voice in any PFOF investigation.
What Washington D.C. Investors Can Do Now
Washington D.C. retail investors who believe they have been harmed by PFOF-driven execution quality degradation can take several steps:
- File a complaint with the DC Department of Insurance, Securities and Banking at https://disb.dc.gov
- File a complaint with the Washington D.C. Attorney General at https://oag.dc.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