Asia Broadband Files $250 Million Lawsuit Against Market Makers for Alleged Manipulation
Asia Broadband Inc. has filed a federal lawsuit seeking $250 million in damages against three market-making firms, alleging systematic manipulation of the company's stock through coordinated trading practices. The complaint, filed January 7, 2026 in the U.S. District Court for the Central District of California, names Virtu Financial Inc., GTS Securities LLC, and G1 Execution Services LLC as defendants in what the company describes as a multi-year campaign to suppress its share price and distort market liquidity.
The 168-page complaint, accessible here, alleges the firms engaged in deceptive trading strategies including spoofing, wash trading, naked short selling, and quote stuffing—manipulative techniques that have drawn scrutiny from regulators in recent years.
Background and Context
Market manipulation allegations against high-frequency trading firms have increasingly come under regulatory scrutiny since the 2010 "Flash Crash," when automated trading exacerbated market volatility. The Securities and Exchange Commission has implemented rules targeting spoofing and other manipulative practices, though enforcement remains challenging given the speed and complexity of modern trading systems.
Asia Broadband's case represents one of the larger private actions targeting alleged coordinated manipulation by market makers. The company, which trades on the OTC market under ticker AABB, focuses on precious metals production in Mexico and has developed cryptocurrency products backed by physical gold and silver.
Key Figures and Entities
The lawsuit targets three prominent trading firms: Virtu Financial Inc. (NASDAQ: VIRT), one of the largest market makers in global equities; GTS Securities LLC, a New York-based proprietary trading firm; and G1 Execution Services LLC, a registered broker-dealer. According to the complaint, these firms allegedly coordinated their trading activities to systematically suppress AABB's share price.
Chris Torres, President and CEO of Asia Broadband, stated in a press release that the company is "taking decisive action to protect its shareholders and the integrity of the public markets." The complaint was filed by Midway Law Firm APC on behalf of the company.
Legal and Financial Mechanisms
The complaint identifies several specific manipulative practices allegedly employed by the defendants. Spoofing involves placing large orders with no intention of execution to create false market sentiment, while wash trading creates artificial volume by simultaneously buying and selling the same securities. Quote stuffing, according to regulatory guidance, involves overwhelming market data feeds with excessive orders to slow competitors and obscure genuine market activity.
According to the filing, these activities were documented through Level II order-book video recordings, trade-tape analysis, and time-sequenced market data collected over multiple years. The company alleges these practices prevented its stock from reflecting fundamental performance metrics and asset value.
International Implications and Policy Response
The case highlights ongoing challenges in regulating modern securities markets, where algorithmic trading operates across global venues in microseconds. While the SEC has strengthened rules against manipulative practices, cross-jurisdictional coordination remains limited, potentially allowing firms to exploit regulatory arbitrage opportunities.
Asia Broadband has indicated it will refer its findings to the SEC and other regulatory authorities for further investigation. The company's allegations, if proven, could prompt additional scrutiny of market-making practices, particularly in less-regulated over-the-counter markets where transparency requirements are less stringent than on major exchanges.
Sources
This report draws on the federal complaint filed by Asia Broadband Inc., public company disclosures, and regulatory guidance from the Securities and Exchange Commission regarding market manipulation and high-frequency trading practices.
