Banking, finance, and taxes
NASDAQ Gets Off Cheap in Facebook IPO SNAFU
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Source: Brian Solis, via Wikimedia Commons
The exchange is reported to have informed traders that it will pay out $41.6 million to firms that lost money during the May 2012 Facebook IPO fiasco. A report from Dow Jones noted that the exchange had set aside $62 million to cover losses from the Facebook IPO. Neither figure approaches the estimated Wall Street losses of $500 million.
Nasdaq OMX will pay the claims through the Financial Industry Regulatory Authority (FINRA) which is the firm that assessed all the claims made against the exchange and determined that $41.6 million was the “total value of valid submitted claims.” FINRA based its judgment on criteria approved by the U.S. Securities and Exchange Commission according to Nasdaq OMX.
One claimant, UBS, is seeking payment through arbitration and that is believed to be the reason the compensation to be paid is below Nasdaq’s $62 million reserve.
Shares of Nasdaq OMX are up about 0.3% at $35.75 in mid-afternoon trading Friday, in a 52-week range of $22.63 to $36.25.
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