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Nasdaq OMX Stockholm fines Carnegie Investment Bank, Skandiabanken and UBS

The Disciplinary Committee at Nasdaq OMX Stockholm has imposed a fine of SEK 400,000 on Carnegie Investment Bank, Skandiabanken and UBS, for breaching the exchange's rules and regulations by mediating sales orders subject to terms that deviated from the current market value.

The exchange rules stipulate that orders placed in the order book must reflect the current market value of the instrument in question and also constitute proper orders and trades. An order does not reflect the current market value if it has been registered at a price that could not constitute the current market value of the corresponding trade.

SeaNet Maritime Communications is the subject of trading on the First North exchange. On 24 January 2011, SeaNet implemented a one-for-1,000 merger of its shares. According to Nasdaq, the merger had been disclosed well in advance on SeaNet’s website and the information was also disseminated by means of various information systems.

Nevertheless, Carnegie, Skandiabanken and UBS, during 24 January independently of each other, entered sales orders for the SeaNet share that, following adjustment, corresponded to a volume that exceeded the holdings of their respective customers.

Accordingly, these orders did not reflect the proper intentions underlying the trades and the conditions for completing delivery for the trades that occurred were lacking.

The trading members’ actions gave rise to serious disruptions of trading in the share and the exchange thus decided to cancel the trades and to suspend trading in the share.

On 25 January 2011, Eniro, whose shares are subject to trading on the exchange, implemented a one-for-50 merger of its shares. The merger had been disclosed well in advance on Eniro’s website and the information was also disseminated by means of various information systems. Nevertheless, UBS entered sales orders for Eniro on 25 January at a price that obviously deviated from the market value.

Nasdaq said that since the rules in question are of vital importance to the functioning of trading on the exchange and for its credibility, the breaches cannot be regarded as minor or excusable. Accordingly, the trading members cannot avoid being sanctioned for their actions.