(Reuters) — CBOE Holdings Inc. is the target of a probe by federal regulators for the way it oversees its markets, the operator of the biggest U.S. stock-options exchange said this week.
U.S. markets are coming under increased scrutiny for the way they police themselves and their customers in the wake of the collapse of futures brokerage MF Global last year.
MF Global was overseen and audited by CME Group Inc. under the futures industry's self-regulatory model. Some $1.6 billion of customer money remains missing since the broker's demise.
Securities exchanges also conduct some policing of their own markets under federal law. CBOE, for instance, became the main regulator of Bats Global Markets Inc in 2011. It also oversees its own markets to ensure traders follow the rules.
"The SEC is investigating CBOE's compliance with its obligations as a self-regulatory organization under the federal securities laws," the CBOE said in its annual financial filing on Tuesday.
The CBOE said it was cooperating with the investigation, which is ongoing and "is conducting its own review of its compliance." A spokesman declined to comment further.
Late last month, Bats Global Markets said it recently received a written request from the SEC's division of enforcement seeking documents and information related to its communications with some market participants, its technology and its trading strategies.
"The investigation is in the early stages and we are cooperating with the staff," Bats said at the time.
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