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Goldman puts 4 on leave after fallout from trading glitch-report
August 26, 2013 / 3:06 AM / in 4 years

Goldman puts 4 on leave after fallout from trading glitch-report

Aug 26 (Reuters) - Goldman Sachs Group Inc put four senior technology specialists on administrative leave after a trading glitch that led to a flood of erroneous options trades, the Financial Times reported, citing people familiar with the situation.

Last Tuesday, an upgrade of an internal system affected options on stocks and some exchange-traded funds with listing symbols beginning with the letters H through L.

The Financial Times said about 80 percent of the mistaken contracts sent to the New York Stock Exchange were cancelled, limiting losses for Goldman. But the glitch “provoked a strong reaction” within the bank, which takes pride in a reputation for risk management, the paper said.()

The system, called a “trading axis”, monitors the Wall Street bank’s inventory to determine whether it should be a more aggressive buyer or seller in the market.

But a technical error misinterpreted non-binding indications of interest, or IOIs, as firm bids and offers, leading to some trades that were vastly out of line with where market prices were, Reuters reported previously, citing a source familiar with the matter.

Goldman Sachs was not available for comment outside of regular business hours.

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