New York state Attorney General Eric Schneiderman will file a securities fraud lawsuit against Barclays for its use of "dark pools" on Wednesday, a source tells CNBC.
Dark pools are trading systems set up by banks that operate outside regulated exchanges.
The suit alleged that the firm's dark pools engaged in deceptive practices, fraud, misleading investors and false advertising.
"We take these allegations very seriously," a Barclays spokesman said. "Barclays has been cooperating with the New York Attorney General and the SEC and has been examining this matter internally. The integrity of the markets is a top priority of Barclays."
Schneiderman's complaint draws on numerous documents, including communications provided by former Barclays employees. "This is a case about fraud and deceit by one of the world's largest banks," Schneiderman said in the complaint.