Exchange operator BATS Global Markets said on Thursday it would outsource part of the surveillance of its four U.S. stock markets to the Financial Industry Regulatory Authority, expanding the industry-funded watchdog's oversight to nearly all equities markets. FINRA has similar agreements with most other U.S. exchanges, where it mines the exchange data to detect abusive market practices, conducts investigations into those practices, and prosecutes cases that warrant formal disciplinary action. Adding BATS' data to the mix will allow FINRA to see 99 percent of the activity on U.S. stock exchanges. "It's important because we are seeing that people are trying to spread their activity across multiple markets to try to avoid detection," said Tom Gira, head of market regulation at FINRA. FINRA mines the data to detect market manipulation, such as "spoofing" and "layering," where market participants use algorithms to place buy or sell orders that are never executed, in order to move
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