New York Stock Exchange to Pay $14 Million Penalty to Settle SEC Claims

(CN) – The New York Stock Exchange was fined $14 million by the Securities and Exchange Commission Tuesday having been charged with “regulatory failures” in connection with multiple episodes, including what regulators described as “several disruptive market events.”

In a written statement, the commission said the violations included erroneously imposing a market-wide regulatory halt on the sale of 134 securities; negligently misrepresenting stock prices as “automated” despite extensive system issues ahead of a total shutdown in July 2015; and applying price collars during unusual market volatility on Aug. 24, 2015, without a rule in effect to permit them.

The stock exchange also broke rules on business continuity and disaster recovery, the commission said.

Federal regulators said the amount of the fine was higher than would ordinarily be assessed for the violations due to the NYSE being a recidivist after previous violations were settled in 2014.

“Two NYSE exchanges previously settled rule-filing violations in 2014, and now we’ve found further problems,” said Steven Peikin, co-director of the SEC’s division of enforcement in a written statement. “NYSE’s violation of the prior SEC order was a significant factor in assessing the civil penalties in this matter.”

In a written statement, a spokesperson for the stock exchange said, “We believe this settlement is in the best interest of the NYSE exchanges.

“We take our regulatory obligations seriously and remain focused on building and maintaining industry leading technology and ensuring that our markets operate with the utmost integrity,” the statement said.

%d bloggers like this: