From Big Law to Solo and Beyond
Nasdaq’s internal review of the hours-long trading shutdown of August 22, 2013 seems to show that its communications gear was overloaded. Nasdaq said that it is working on the issue and will strengthen its systems.
Apparently, a flood of messages from NYSE Arca hit the Nasdaq system at a rate of over 2.5 times what the Nasdaq system was designed to handle. Its capacity exceeded, the system degraded.
Contrary to some reports (or guesses), high frequency trading played no role in the shutdown.
Three of the five alleged hackers are at large as the DOJ issues indictments in what I referred to the “largest such scheme ever prosecuted in the United States.” The hackers, five Russian and a Ukrainian, stole more than 160 million credit card numbers from a number of payment processors, retailers and financial institutions.
Nasdaq was a target, but its trading platforms were not compromised.
Among the U.S. Attorneys mentioned in the article is Preet Bharara, who is having a big week. He is also involved in the SAC Capital insider trading case.