Passage from Patterson's Dark Pools: The Rise of the Machine Traders and the Rigging of the U.S. Stock Market:

In 1994, two finance professors, Bill Christie and Paul Schultz, published a groundbreaking study based on the trading data of Nasdaq stocks such as Apple and Intel.

The two professors had noticed something very odd in the data: Nasdaq market makers rarely if ever posted an order at an “odd-eighth” — as in $10⅛ $10⅜ $10⅝ or $10⅞ (recall that this was a time when stocks were quoted in fractions of a dollar, not pennies.) Instead, they found that for heavily traded stocks such as Apple, market makers posted odd-eighth quotes roughly 1 percent of the time.

When they looked at spreads for stocks on the NYSE or American Stock Exchange, by comparison, they found a consistent use of odd-eighths. That meant Nasdaq market makers must be deliberately colluding to keep spreads artificially wide. Instead of the minimum spread of 12.5 cents (one-eighth of a dollar), spreads were usually twenty-five or fifty cents wide. That extra 12.5 cents was coming directly out of the pockets of investors. Add it up, and Nasdaq’s market makers were siphoning billions out of the pockets of investors.

...Inside the SEC, the study erupted like a bomb. The Nasdaq investigation was assigned to a staid, low-key attorney in the enforcement division named Leo Wang. Socially awkward, but aggressive as a pit bull, Wang had gained prestige within the commission for handling a high-profile bond-manipulation case against Salomon Brothers in the early 1990s.... [Wang] started hammering Nasdaq dealers with subpoenas, demanding transaction records. He hit the jackpot when he forced the firms to hand over truckloads of tape recordings going back years. Traders had been oblivious to the recordings, which were made as a backup in the event of a dispute over the details of a trade. Inside the SEC, the enormity of the task of reviewing the tapes at first seemed daunting — it could take weeks, if not months, to comb through them for evidence of price fixing.

But it proved all too easy: The very first tape Wang played revealed two dealers fixing prices.