Facebook IPO: Knight Capital Criticizes Nasdaq over Payment

0

Facebook IPO: Knight Capital Criticizes Nasdaq over Payment

NASDAQ OMX Group, Inc. (NASDAQ:NDAQ) has received criticism from all the corners ever since it screwed up with the Facebook Inc (NASDAQ:FB) IPO. Criticizing the $40 million payout plan by Nasdaq to compensate the investors and brokers, Thomas Joice, the CEO of Knight Capital Group Inc. (NYSE:KCG) said that the total losses are close to $200 million.

Thomas further added that he was “disappointed that Nasdaq’s compensation fund does not come close to covering reported losses from broker-dealers. Their proposed solution to this problem is simply unacceptable.”

Q2 Hedge Funds Resource Page Now LIVE!!! Lives, Conferences, Slides And More [UPDATED 7/7 17:16 EST]

Q2 Hedge Funds Resource PageSimply click the menu below to perform sorting functions. This page was just created on 7/1/2020 we will be updating it on a very frequent basis over the next three months (usually at LEAST daily), please come back or bookmark the page. As always we REALLY really appreciate legal letters and tips on hedge funds Read More


“Nasdaq made decisions that created this problem that the industry suffered through, and it’s up to Nasdaq to create a solution. Nasdaq has got to go back to the drawing and come back with something sensible.” Bloomberg reported him saying.

Knight Capital Group Inc. (NYSE:KCG) is one of the top four market makers in the Facebook IPO, the other three being Citigroup, UBS and Citadel Securities. They together lost over $115 million due to the technical problems that kept them for two hours from knowing whether their orders have been processed.

On the other hand, Nasdaq firmly defended its decision to pay out the firms that lost money due to technical problems. Nasdaq CEO, Bob Greifeld stressed that Nasdaq’s decision to pay back loss-making firms is a voluntary move, and the exchange has no legal obligation to do so. “We stand by our analysis, and there is no emotion to it.”

Apparently, Knight Capital CEO Thomas Joice and Nasdaq top gun Bob Greifeld were speaking at the same conference –  Sandler O’Neill & Partners LP Global Exchange and Brokerage Conference in New York.