Stifel, Nicolaus & Company, Inc has agreed to pay a fine of $70,000 as a part of a settlement with Nasdaq.

Between September 2020 and January 2023 (the “Review Period”), the firm failed to implement risk management controls and supervisory procedures that were reasonably designed to prevent the entry of erroneous orders.

Specifically, and due to a coding error, the firm failed to apply its average daily volume (ADV) control for outbound orders to certain orders that were directed to the firm’s algorithmic trading strategies. As a result, those orders were only subject to the firm’s Max Quantity control, which was set at a threshold that was not reasonably designed to prevent the entry of erroneous orders.

The firm allegedly violated Section 15(c)(3), Rules 15c3-5(b) and 15c3-5(c)(l)(ii) thereunder, and Nasdaq Rule General 9, Sections 1(a) and 20(a).

The firm has agreed to a censure in addition to the $70,000 fine.