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Facebook’s (NASDAQ:FB) botched $16 billion IPO is estimated to have cost investors over $500 million. UBS AG (NYSE:UBS) disclosed it lost more than $350 million, Citigroup’s (NYSE:C) automated trading desk is said to have lost $35 million, and Knight Capital (NYSE:KCG) claims more than $35 million in losses.
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Nasdaq OMX Group’s (NASDAQ:NDAQ) liability is capped at $3 million dollars, but the exchange has offered a new ultimatum on payout for damages: $62 million. The plan is expected to be reviewed by the SEC in Q4, but market makers, brokers, and individual investors have called for it to be rejected. UBS and Citigroup say that Nasdaq should be held accountable for all of the losses associated with the IPO. Knight Capital, perhaps sympathetic due to its own costly glitches, has accepted the settlement.
Lee Shavel, Nasdaq’s chief financial officer, believes “that this addresses the issues that we identified in a very fair, reasonable, and objective manner,” adding that the company has robust legal and factual defenses in regard to any litigation associated with the IPO.
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