Nomura Securities International, Inc. has agreed to pay a fine as a part of a settlement with Nasdaq Phlx LLC.

During the period of April 2019 through October 2022, Nomura failed to accurately record order receipt, transmission, or execution times and/or the correct Exchange to which the trader routed the order.

During this period, the firm maintained inaccurate timestamps or information for approximately 11,328 manual options orders executed on Phlx and other options exchanges.

Accordingly, Nomura violated Exchange Act Section 17(a) and Exchange Act Rule 17a-3, and Phlx Rule 760 (for conduct before February 3, 2020), and Phlx Rule Options 6E, Section 1 (for conduct on and after February 3, 2020).

From January 2019 to August 2024, Nomura failed to establish, maintain, and enforce supervisory systems and procedures, including written supervisory procedures, reasonably designed to achieve compliance with the recordkeeping obligations of the federal securities laws and Phlx Rules.

The firm’s supervisory systems and procedures failed to provide for reasonable identification, escalation, and remediation of the timestamp and executing exchange information inaccuracies in the Firm’s manual options order memoranda.

While the Firm’s supervisory system for manual options orders required designated principals to review the accuracy of timestamp and executing exchange information on the Firm’s order memoranda, the reviews were too limited in scope to identify the full extent of the Firm’s inaccuracies.

The Firm also failed to provide reasonable guidance to designated supervisory principals on how and whether to take further action when they became aware of traders who entered inaccurate information on manual option orders.

In practice, even when firm personnel identified inaccuracies in the firm’s manual options order memoranda, the firm personnel failed to reasonably escalate the issues and the firm failed to correct the inaccuracies.

Accordingly, Nomura violated Phlx Rule 748(h) (for conduct before February 3, 2020) and Phlx General Regulation 9, Section 20 (for conduct on and after February 3, 2020), and Phlx Rule 707 (for conduct before February 3, 2020), Phlx Rule Options 9, Section 1 (for conduct between February 3, 2020 and January 21, 2021) and Phlx Rule General 9, Section 1(c) (for conduct on and after January 22, 2021).

Nomura has agreed to the imposition of a censure and a fine of $275,000, of which $86,000 must be paid to Nasdaq Phlx. The balance of the fine must be paid to Cboe Exchange, Inc., NYSE American LLC, and NYSE Arca, Inc.