BofA Fined by SEC for Lapses That Caused Mini-Flash Crashes
- $12.5 million fine is largest ever for market abuse violations
- Weak trading controls led to stock drops of 99 percent
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Bank of America Corp.’s Merrill Lynch unit was fined $12.5 million to settle allegations that the broker’s weak controls led to multiple orders being sent to markets, resulting in mini-flash crashes.
The bank set its internal trading limits too high, so they were ineffective and caused market disruptions on at least 15 occasions from late 2012 to mid-2014, according to a statement Monday from the U.S. Securities and Exchange Commission. They included 99 percent drops in the stocks of Anadarko Petroleum Corp. and Qualys Inc., and an almost 3 percent dip in Google Inc.’s stock in less than a second in 2013, according to the statement.