“The nation’s top securities regulator proposed new rules Thursday aimed at preventing the breakdowns in automated trading systems that have threatened to undermine investor confidence.
The proposal, known as Regulation SCI, short for systems, compliance and integrity, would replace an existing program under which operators of alternative trading systems and other financial organizations operated under voluntary standards not covered or enforced by formal SEC rules.
Formal rules are needed, several SEC commissioners said, citing the 2010 Flash Crash in which the Dow abruptly dropped 600 points before recovering, the August computer problem that triggered a $460 million loss for trading firm Knight Capital Group and technology glitches that marred Facebook’s 2012 initial public offering.
In a unanimous 4-0 vote, the Securities and Exchange Commission proposed that certain alternative trading systems, self-regulatory organizations, clearing agencies and plan processors be required to design, develop, test and maintain the electronic systems that are integral to their operations…..”
If you enjoy the content at iBankCoin, please follow us on Twitter
