Instinet, LLC has agreed to pay a fine of $25,000 as a part of a settlement with Nasdaq PHLX LLC.

During the period June 30, 2025, through November 14, 2025 (the “Review Period”), Instinet, in connection with 48 PIXL Auctions, submitted more than one order in response to a PIXL Auction Notification (PAN) at a particular price point that exceeded, in the aggregate, the size of the PIXL Order.

As a result, Instinet entered orders for 282 more contracts than it should have, resulting in at least 209 executions.

This conduct constitutes a violation of Phlx Rule Options 3, Section 13(b)(1)(K) and Phlx Rule General 9, Section 1(c).

Also, during the Review Period, Instinet’s written supervisory procedures (WSPs) were not reasonably designed to detect and prevent violations of Phlx Rule Options 3, Section 13(b)(1)(K). Although the firm’s WSPs instructed Firm personnel to review a surveillance report that was designed to identify PIXL Auctions to which Instinet had sent multiple responses, the WSPs did not inform reviewers that they should review for instances where multiple PAN responses were submitted at the same price point that, in the aggregate, exceeded the size of the PIXL Order.

Relatedly, the firm’s surveillance system was not reasonably designed to detect and prevent violations of Phlx Rule Options 3, Section 13(b)(1)(K). Specifically, while the firm’s surveillance report was designed to generate an exception when a Firm client or clients submit more than one order to a PIXL Auction, it was not designed to consider whether the aggregate size of the responses was greater than the PIXL Order.

As a result, the firm failed to identify the violations at issue in this matter.

Finally, while Instinet was aware as early as August 2025 that two of its clients were responsible for the majority of the violative orders at issue, Instinet failed to introduce any mechanism to prevent those clients from submitting responses to PANs, even though the firm had previously implemented such a block in the past.

The conduct described in paragraphs eight through ten constitutes a violation of Phlx Rule General 9, Sections 20(h) and 1(c)(1).

The firm has agreed to a censure on top of the $25,000 fine.