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"Today's interruption in trading, while resolved before the end of the day, was nonetheless serious and should reinforce our collective commitment to addressing technological vulnerabilities of exchanges and other market participants," SEC Chairman Mary Jo White said. The SEC likely will scrutinize Nasdaq's systems and emergency procedures, and could order the exchange to upgrade them if it finds them lacking, said Phil Stern, a former SEC attorney now in private practice. In addition, Nasdaq could face significant financial penalties and other sanctions as a result of the breakdown, Stern suggested. "The (SEC) is going to have to be satisfied one way or the other that the likelihood of this happening again is extraordinarily remote," he said. "They have to be sure that the Nasdaq has taken every step to avoid a recurrence of this event." The actions Nasdaq takes, or should take, will be closely watched. Those range from improved testing and backup of its systems to ramping up its crisis management and communicating more clearly with the investing public. The Nasdaq exchange was born of technology and is dominated by the biggest names in the field like Microsoft, Apple and Google. Thursday's breakdown followed a series of tech-rooted disasters involving various exchanges. They included Facebook's bungled public offering launch on Nasdaq in May 2012, one of the largest IPOs in history. The SEC later fined Nasdaq $10 million for that disruption
-- the largest penalty it ever imposed on an exchange.
[Associated
Press;
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