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Brokers face fines over role in flash crash

  1. Brokers who allowed high-frequency traders to have access to the markets without undertaking proper checks on them face potential fines as part of a clampdown following the “flash crash”, the head of a US watchdog said on Sunday.

    The Financial Industry Regulatory Association is undertaking a “sweep” of broker-dealers that offer market access to high-frequency traders to find out if they allowed these firms to run computerised trading programs – algorithms – without undertaking proper risk-management controls.

    http://www.ft.com/cms/s/0/0ab57556-ae17-11df-bb55-00144feabdc0.html?ftcamp=rss
     
  2. That is really interesting.

    It is both fortunate and unfortunate. I would have always used the privilege of naked access to get a legitimate edge. It appears that others used it to confuse and take advantage of the system itself.

    It never fails. A few idiots ruin it for everybody.