You are conflating Reg NMS NBBO with a broker-dealer’s duty of best execution. RH has a fiduciary duty to customers to (on balance) achieve best ex. And a fiduciary duty means they must act in the best interest of their customers — including putting customer interests ahead of their own. Here RH was clearly prioritizing their own interests ahead of their customers.
I've read the SEC's order and I am certain what I've said is accurate. This is about best execution, not Reg NMS. See paragraphs 5, 13-4, 43-44 and footnote 2.
There are two violations in the order:
(1) Securities Act Sec. 17(a) arising from Robinhood's failure to fulfill their duty (in this case, of best execution).
(2) Exchange Act Sec. 17(a) arising from Robinhood's failure to keep adequate records which means that during the course of the investigation the SEC asked for one or documents and Robinhood, for whatever reason, failed to produce the requested document(s).
Neither of those violations relate to Reg. NMS or NBBO which was promulgated under Exchange Act Sec. 11A and is not mentioned anywhere in the Order.
You're right, of course. I think what happened here is that I jumped the gun on what I perceived your argument to be; that you were expressing something like the sentiment that Robinhood has to maximize customer outcomes on trades; that, for instance, if it has a dial that can go 80/20 -> 20/80 broker/customer on rebates, it actually is required to turn that dial to 0/100 if possible.
