“Pressure is mounting on the Securities and Exchange Commission to address the increasingly fragmented electronic stock-trading system in the U.S. after a glitch on the Nasdaq Stock Market caused big losses for some investors,” writes Craig Karmin in today’s Wall Street Journal.

“New York Democratic Sen. Charles Schumer Tuesday called on the SEC to address what he said were the risks to investors from an overly fragmented market where a single set of rules is difficult to follow and enforce.”

” ‘When you don’t have a single, deep liquid market but instead competing exchanges, it can create all kinds of problems,’ Mr. Schumer said in an interview. ‘This is crying out for some serious examination and proposals to prevent this sort of thing from happening again in the future.’ “

“The problem arose on Friday when the share price of Corinthian Colleges Inc., a Santa Ana, Calif., educational services concern, suddenly plunged 32% over eight minutes. The selloff, which was apparently caused by erroneous trading, prompted Nasdaq to halt trading in the stock.”

“But an electronic exchange, run by Archipelago Holdings LLC, resumed trading in the stock about 30 minutes before Nasdaq did. Nasdaq later canceled hundreds of trades in the stock over an eight-minute period, leading many traders to complain that those cancellations caused them losses.”

“Mr. Schumer’s comments followed calls to the commission by Nasdaq to address issues related to Corinthian. Nasdaq wants the SEC to make clear that trading halts on Nasdaq issues must be obeyed by all markets. Meanwhile, Archipelago’s regulator, the Pacific Exchange, is asking the SEC to examine Nasdaq’s handling of the trading halt.”

“SEC spokesman John Nester said the commission is looking into the controversy surrounding the Corinthian trades. He declined to say specifically what issues the SEC was considering, though he added, ‘We’ve said on a number of occasions that a broad-based review of market structure is a top priority for the commission.’ “