SEC Approves Plan For Lost Facebook IPO Money
Regulators on Monday approved a plan to compensate market makers who lost money in a botched Facebook Inc public offering in May on the Nasdaq exchange.
Nasdaq, a unit of Nasdaq OMX Group Inc, has proposed a revised $62 million settlement to those brokerages that lost money.
The decision from the U.S. Securities and Exchange Commission was in response to a series of high-profile glitches last year that shook the market, including the handling of Facebook's long-anticipated initial public offering.
The May 18 IPO, which raised $16 billion, was initially delayed by 30 minutes due to a technical problem at Nasdaq.
The exchange then decided to get the stock trading by using a secondary system that ended up leading to delays of many clients' orders and confirmations. This cost some investors and traders big losses as the stock price dropped after an initial gain.