NYSE Euronext Fine, Automated Systems, Cyprus: Compliance l Rediffpages http://pages.rediff.com/talinec-holdings-ltd/1799156 NYSE Euronext (NYX), the biggest U.S.

exchange operator, will pay $5 million to resolve regulatory claims that the New York Stock Exchange violated rules by giv ing certain customers a head start on trading information. The NYSE sent data through two proprietary feeds to paying customers before rela ying the information to the so-called consolidated feed, which distributes trade and quote data to the public, the Securities and Exchange Commission said in an administrative order filed Sept. 14. Investigators are conducting similar revie ws of other exchanges, according to two people with knowledge of the probes, whi ch arent public. The SEC penalty, the first of its kind against an exchange, comes as lawmakers a nd regulators question whether retail investors are being harmed in an increasin gly fragmented marketplace of high-speed, computer-driven trading. NYSEs practice was discovered in the SECs investigation of the so- called flash crash of May 20 10, in which $862 billion was erased from equity prices in 20 minutes before rec overing. The practice violated Regulation NMS, which obliges exchanges to give the public fair access to market information, the SEC said. The NYSE violated SEC rules ove r an extended period of time starting in 2008 by failing to monitor the speed of its proprietary feeds compared to the consolidated feed, the agency said in its order. The violations stemmed from technology issues in NYSEs Open Book Ultra and PDP Qu otes proprietary data feeds, according to the SEC. The timing differentials stemmed from technology issues, not from intentional wro ngdoing by the exchange or any of its personnel, NYSE Euronext Chief Executive Of ficer Duncan Niederauer said in a statement. The company, which operates exchang es in the U.S. and Europe, will ensure that our market operates with the utmost f airness and transparency, he said. While the SEC has previously faulted exchanges for misconduct by employees, the Sept. 14 action marks the first time the agency has fined an exchange for having faulty systems that violated securities rules. The SEC action follows the Nasdaq Stock Markets flubbed initial public offering o f Facebook Inc. (FB) in May and Bats Global Markets Inc.s withdrawal of its IPO a fter a technology glitch in March, both of which undercut investor confidence th at exchanges are in command of their technology systems. The agency is consideri ng a new rule to mandate that exchanges and possibly brokers employ adequate aut omated systems to operate their markets and related platforms, according to Dave Shillman, an executive in the SECs trading and markets division. The SEC penalty, the first of its kind against an exchange, comes as lawmakers a nd regulators question whether retail investors are being harmed in an increasin gly fragmented marketplace of high-speed, computer-driven trading. The NYSEs prac tice was discovered in the SECs investigation of the so- called flash crash of Ma y 2010, in which $862 billion was erased from equity prices in 20 minutes before recovering. See more info: http://www.bloomberg.com/news/2012-09-17/nyse-euronext-fine-autom ated-systems-cyprus-talks-compliance.html