BofA Fined by Korea Exchange Over ‘Almost Phantom Orders’
(Bloomberg) -- Bank of America Corp.’s brokerage arm in South Korea was fined 175 million won ($149,000) by the nation’s stock exchange for violating market rules.
The U.S. firm disrupted fair market orders through algorithmic trading, Korea Exchange’s market oversight committee said in a statement Tuesday. It helped a hedge fund client earn 220 billion won of profit by repeatedly submitting and canceling quotes for hundreds of stocks in Korea between October 2017 and May 2018, the KRX said, describing them as “almost phantom orders.”
Mark Tsang, a Hong Kong-based spokesman for Bank of America, declined to comment.
The fine comes months after the exchange started monitoring stock trades made through Bank of America’s Merrill Lynch in Seoul, following several anonymous petitions posted on the presidential office’s website last year.
The petitions asked the government to investigate high-speed algorithmic trading handled by the U.S. bank, saying those transactions manipulated share prices, especially of small caps on the Kosdaq, where most trading is done by retail investors.
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