Citadel Securities Faces SEC Charges for Short Sale Regulation Violations
Citadel Securities, a broker-dealer, has settled charges with the Securities and Exchange Commission (SEC) for violating a provision of Regulation SHO, which requires marking sale orders as long, short, or short exempt. The SEC found that Citadel Securities incorrectly marked millions of orders over a five-year period due to a coding error in its automated trading system. The firm provided inaccurate data to regulators, including the SEC. As part of the settlement, Citadel Securities will pay a $7 million penalty and undertake remedial measures. Compliance with order marking requirements is crucial in curbing abusive market practices, such as naked short selling.