HONG KONG, Aug 1 (Reuters) - Hong Kong's securities watchdoghas warned banks it will clamp-down on exchange tradingplatforms known as dark pools in a direct fallout from theBarclays Plc scandal in the United States, peoplefamiliar with the matter told Reuters.
The increased regulatory scrutiny by Hong Kong's Securitiesand Futures Commission (SFC) could hurt prospects for thenascent dark trading market in the Asian financial center andmay trigger similar action by other regulators in the region,the people added.
Banks in Hong Kong have sought legal advice following aconfidential meeting convened by the SFC's supervisorydepartment last month, during which the watchdog told firms itwould step-up scrutiny of dark pool marketing materials, oneperson said.
The SFC declined to comment. Sources also declined to beidentified as discussions with regulator were private. (Reporting by Michelle Price; Editing by Denny Thomas and ShriNavaratnam)