- with readers working within the Banking & Credit industries
A broker-dealer settled Nasdaq Stock Market LLC ("Nasdaq") charges for failure to maintain "continuous two-sided trading interest during regular market hours, at prices within certain percentages away from the National Best Bid or Offer," as required by Nasdaq Rule 4613(a).
In a Letter of Acceptance, Waiver and Consent, Nasdaq determined that these compliance failures were a result of:
- a misunderstanding of the functionality of the broker-dealer's order management system;
- insufficient training on the use of the broker-dealer's order management system after software updates;
- the failure of the broker-dealer's compliance department to perform supervisory reviews; and
- a software malfunction.
Additionally, Nasdaq stated that the broker-dealer and its predecessors' supervisory system was not sufficiently designed to reach compliance with the quoting obligations under Nasdaq Rule 4613(a), in violation of Nasdaq Rules 2010A and 3010.
To settle the charges, the broker-dealer agreed to a (i) censure and (ii) $25,000 fine ($12,500 for the Nasdaq Rule 4613(a) violations, and $12,500 for the Nasdaq Rule 2010A and Rule 3010 violations).
Originally published July 15, 2020.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
