Aritas Securities

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Aritas Securities
Founded 1999 (as Pipeline Trading Systems LLC)
Headquarters New York
Products Pipeline PowerPlay, Algorithm Switching Engine, Contra Targeting
Website www.pipelinetrading.com

Aritas Securities, formerly Pipeline Trading Systems LLC, was an Alternative Trading System (ATS), aka a dark pool, that enables institutions and brokerage firms to trade blocks of NYSE listed companies, NASDAQ stocks, ADRs and Exchange Traded Funds (ETFs)[1]

Aritas maintains a hidden book of large, executable limit orders with strict price time priority. The company facilitates interaction between traders, enabling all real buyers and sellers to find each other anonymously and get trades done while minimizing gaming.

The company rebranded as Aritas in January of 2012.[2]

On May 10, 2012, Aritas/Pipeline announced it had stopped accepting orders and was selling its key technology assets, and that its executive chairman, Jay Biancamano, would be leaving to join software vendor Portware. Portware agreed to buy Aritas's key technology assets. [3]

History

Pipeline was founded by Fred Federspiel, a neurophysicist who previously worked at the Los Alamos National Lab in New Mexico, and Alfred Berkeley, a former president and vice chairman of The Nasdaq Stock Market. Pipeline sought to differentiate itself from other block trading venues by setting minimum order size limits of 10,000, 25,000 and 100,000 shares, depending on the stock, to prevent predators from risking a small amount of capital on small orders to sniff out large institutional orders.

On Oct. 24, 2011, the SEC announced that Pipeline Trading Systems would pay a $1.2 million penalty to settle charges that the broker and two of its top executives failed to disclose to customers that the majority of orders sent to the firm's dark pool were filled by a wholly owned trading affiliate rather than by matching them against other customer orders, as advertised.[4] Neither Pipeline nor its executives admitted or denied wrongdoing in the settlement. The matter was the SEC's first enforcement action involving a dark pool.

Pipeline's chairman, Alfred Berkeley III, and its chief executive Fred Federspiel stepped down from the company and a new chairman, Jay Biancamano, was appointed. [5]

On November 18, 2011, Pipeline Financial Group said it would divest the trading subsidiary, Milstream Securities LLC, that regulators said secretly took advantage of Pipeline clients' information. Pipeline said it was reviewing its options, including the possibility of selling the subsidiary.[6]

On November 30, 2011, Pipeline said it had discontinued its options business. [7]

Products and Services

Key People

References

  1. About Pipeline Trading Systems LLC. Pipeline Trading Systems LLC.
  2. Pipeline Struggles to Start Over. Traders Magazine.
  3. Pipeline Trading Ceases Operations; Top Executive Steps Down. Traders Magazine.
  4. Pipeline's Bombshell Hurts All Dark Pools. Advanced Trading.
  5. Pipeline Struggles to Start Over. Traders Magazine.
  6. Pipeline to Cut Ties With Subsidiary. WSJ.com.
  7. Pipeline Trading Systems Discontinues Options Business. The Wall Street Journal.