Slashdot Mirror

← Back to Stories (view on slashdot.org)

Knight Capital Fined $12M For a Software Bug That Cost $460M

Posted by samzenpus on from the slap-on-the-wrist dept.

Mark Gibbs writes "Knight Capital monumentally fouled up a software update. According to the SEC, 'Knight did not have supervisory procedures to guide its relevant personnel when significant issues developed.' In other words, not only was Knight's code management inadequate but their human management processes were just as bad. The fine for what could have been a biblical financial disaster? A measly $12 million."

4 of 192 comments (clear)

  1. Maybe I am stupid, please explain. by Anonymous Coward · · Score: 4, Interesting

    They were FINED 12M, and they LOST 460M discovering the bug. This cost them a total of 476M.

    I am not understanding the outrage. Why should the SEC care if Knight Capital wanted to lose a big pile of money.

    1. Re:Maybe I am stupid, please explain. by Anonymous Coward · · Score: 5, Interesting

      Why should the SEC care if Knight Capital wanted to lose a big pile of money.

      Because SEC has the political mission to portray the stock market as a rational, efficient, professional and socially useful apparatus - not the cesspool of mother-fucking sharks that it is. Hence all the trading rules which are selectively enforced so as to maintain the illusion without scarring the sharks away to, say, London.

  2. compensation by MickyTheIdiot · · Score: 4, Interesting

    Can someone tell me why these financial institutions are never forced to compensate the *individuals* that suffer from these events?

    For instance in the mortgage fraud scandal they were allowed to settle fraudulent foreclosures for pennies on the dollar. Why are these companies never required to make the people they hurt whole again? Individuals that paid thousands of dollars simply got a small payment while banks just had to deal with "the cost of doing business."

    I think I know the answer (lobbying/congresscritters in their pockets) but I think it's one of the most scandalous aspects of the financial mess of 2008.

  3. Re:The Fine was $12 M, but, by Lumpy · · Score: 4, Interesting

    Exactly, the $12M should have been a direct fine to the CEO or the board members. You have to punch in the face the people responsible.

    --
    Do not look at laser with remaining good eye.