Nasdaq will pay a $10 million penalty, the largest ever for an exchange, due to violations of securities laws related to “its poor systems and decision-making during the initial public offering (IPO) and secondary market trading of Facebook (FB) shares,” the SEC said in a statement.
Facebook’s debut last May was marred by many technical problems.
First, Facebook shares started trading a half hour late. Then, some traders began complaining that it didn’t seem as though their orders were being completed. Others found that they were getting shares at a higher price than they expected.
Many slammed Nasdaq for the snafu, and brokerage firms filed lawsuits.
“Exchanges have an obligation to ensure that their systems, processes, and contingency planning are robust and adequate to manage an IPO without disruption to the market,” the SEC said.