Firm Charged with High-Frequency Trading Settles with SEC for $1 Million
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zhudifeng/iStockphoto/Thinkstock(NEW YORK) — New York-based trading firm Athena Capital Research agreed to pay a $1 million penalty after being charged with fraudulent trading by the Securities and Exchange Commission.
According to an SEC press release, the company allegedly placed “a large number of aggressive, rapid-fire trades in the final two seconds of almost every trading day during a six-month period.” This action, the agency said, allowed the company to “manipulate the closing prices of thousands of NASDAQ-listed stocks.”
Athena allegedly used an algorithm to engage in the fraudulent trading, and the SEC says that the company was aware of the price impact its actions had.
“When high frequency traders cross the line and engage in fraud,” SEC Chair Mary Jo White said, “we will pursue them as we do with anyone who manipulates the markets.”
Athena’s fraudulent activity took place between June 2009 and December 2009, and made up over 70 percent of the total NASDAQ trading volume in the final seconds before market closing.
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