Bats Says System Errors Cause Pricing Problems

Bats Global Markets Inc., the third-largest U.S. stock exchange operator, said its computers allowed trades that violated rules intended to ensure all investors get the best prices for equities over a period of four years.

Machines that match orders for two Bats equity exchanges and an options venue allowed some trades to occur at prices inferior to the best available bid or offer and enabled others to violate rules for short sales, or bearish bets, the company said in a notice published on its website yesterday. Customers lost $420,360, because of rule violations, Randy Williams, a Bats spokesman, said by e-mail.