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SEC Fines Goldman Sachs, Citadel Over Trading Errors

The SEC fined Goldman Sachs $6 million for sending inaccurate or incomplete trading data and Citadel $7 million for breaking short sales labeling rules and incorrectly marking millions of trade orders.

The Securities and Exchange Commission announced it fined Goldman Sachs $6 million and Citadel Securities $7 million over errors the firms made regarding trading data.

Goldman Sachs agreed to pay a $6 million fine on Friday for sending inaccurate or incomplete trading data to the SEC covering at least 163 million transactions over a decade. 

The information contained in more than 22,000 data files known as blue sheets that firms routinely send to regulators, according to the SEC. The regulator said that Goldman’s submissions had 43 different types of errors. 

Goldman admitted to the findings in the regulator’s settlement order. The Wall Street bank also reached a related settlement with the Financial Industry Regulatory Authority, the SEC said. 

A representative for Goldman, which the SEC said has taken steps to address the issues, did not immediately reply to a request for comment. 

In a separate order, the SEC said Citadel Securities broke rules for labeling short sales and may have incorrectly marked millions of trade orders over a five-year span.   

The firm, which didn’t admit to or deny the allegations, agreed to pay a $7 million penalty. The SEC said that the lapses resulted from a coding error in the firm’s automated system, and that Citadel Securities provided inaccurate data to the regulator over the period.

Ken Griffin’s Miami-based firm is one of the top market makers in the US equity market. According to the SEC, Citadel Securities inaccurately indicated that certain short sales as longs, and vice versa. The mis-marks, however, were brief and often resolved within minutes, the regulator said.

In a statement, Citadel Securities said that the issue had no impact on executing trades for clients. “While updating our systems to accommodate certain client requests, we made a coding change that inadvertently affected a de minimis percentage of our order markings. We detected the issue and promptly fixed it more than three years ago,” the firm said. 

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