Inaccurate Data for Short Sale Orders

The SEC charged two affiliated entities with using inaccurate data in the course of executing short sale orders.

According to the SEC, broker-dealer personnel appropriately ceased using the easy-to-borrow ("ETB") list to source locates when availability of certain shares became restricted, but the firm's execution platforms were programmed to continue processing short sale orders based on the ETB list. The SEC found that it wasn't until the platforms received the next day's ETB list that they returned to utilizing accurate and present data.

See: SEC Order.