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Nasdaq Paying $10M To Settle Facebook Disruption

Nasdaq has agreed to pay a $10 million penalty to settle federal civil charges after regulators said its systems and decisions disrupted Facebook’s public stock offering last year.

The Securities and Exchange Commission said Wednesday that the penalty is the largest ever imposed against an exchange. Nasdaq also has had to pay $62 million in reimbursements to investment firms that lost money because of the problems.

Facebook launched its initial public offering on May 18, 2012 amid great fanfare. But computer glitches at Nasdaq delayed the start of trading and threw the launch into chaos. The technical problems kept many investors from buying shares that morning, selling them later in the day or even knowing whether their orders went through. Some said they were left holding shares they didn’t want.

The SEC says a design flaw in Nasdaq’s systems was to blame and Nasdaq officials then made a series of “ill-fated decisions.”

Source: AP-Excite

FULL story at link.

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