A Major Market Maker Now Gets Away With Illegal Reporting

June 12, 2025

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Updated on July 8, 2025

A major market maker has gotten away with illegal data reporting, resulting in a mere slap on the wrist by the Financial Industry Regulatory Authority (FINRA).

FINRA has imposed a $100,000 fine on Susquehanna Financial Group, LLLP (SFG) for inaccurately reporting an astounding 74,000 transactions and failing to maintain an adequate supervisory system between February 2021 and May 2023.

While FINRA touts the penalty as a step toward ensuring market transparency, retail investors on social media argue the fine is a negligible deterrent for a firm of Susquehanna’s stature, highlighting systemic leniency in regulatory enforcement.

According to FINRA’s findings, Susquehanna inaccurately reported transactions in TRACE-eligible securities, omitting the required “NR” (non-reportable) indicator, which is critical for maintaining accurate audit trails and supporting regulatory surveillance.

This lapse affected roughly 74,000 trades, obscuring market activity and undermining investor confidence.

Additionally, FINRA noted that Susquehanna failed to establish a supervisory system to ensure compliance with its TRACE reporting obligations, a violation of FINRA Rules 3110 and 2010.

The firm accepted the censure and fine without admitting or denying the allegations, a common practice that allows firms to settle without acknowledging wrongdoing.

This settlement, detailed in FINRA’s Letter of Acceptance, Waiver, and Consent, has sparked debate about whether the penalty matches the scale of the infraction.

A Drop in the Bucket: The Fine’s Insignificance

Susquehanna Financial Group, a subsidiary of Susquehanna International Group (SIG), is a major player in global financial markets, with billions in assets under management and significant influence in equities, options, and ETF trading.

For a firm of this magnitude, a $100,000 fine is widely seen as inconsequential—akin to a parking ticket for a billionaire.

Comparatively, other firms penalized for similar violations faced similarly modest fines.

For instance, Goldman Sachs was fined $1.45 million for over 90 million inaccurate order memoranda and 6.8 million misreported trades in 2021, while Citadel paid around $1 million for comparable errors.

On X, users have pointed out this disparity, with one post noting, “Susquehanna paid $1.35 per error.

If Citadel and Goldman paid the same fine per error, they’d owe billions” (@StonksBatman).

This sentiment reflects a growing frustration that FINRA’s fines are disproportionately low relative to the volume of errors and the firms’ financial capacity.

Analysts argue that such fines are often treated as a “cost of doing business” rather than a meaningful deterrent.

“For a firm like Susquehanna, $100,000 is pocket change,” said financial regulation expert Dr. Emily Hartwell.

“These penalties need to scale with the firm’s revenue and the severity of the violation to have any real impact.”

The reaction on X has been overwhelmingly critical, with users labeling the fine as “pathetic” and accusing FINRA of cozying up to Wall Street giants.

One user (@AznPwr86) called it “another do-nothing fine from criminals at FINRA against their partners in crime,” suggesting a perceived lack of impartiality in regulatory enforcement.

Others, like @Prox20011, questioned why FINRA and the SEC don’t impose harsher penalties or restrict trading privileges for non-compliant firms, noting that “$10B in fines remain uncollected over years.”

This public sentiment underscores a broader distrust in the regulatory system, with many believing that FINRA’s penalties fail to hold powerful firms accountable.

The lack of transparency about the affected stocks or the total shares traded further fuels speculation that FINRA is shielding Susquehanna from deeper scrutiny.

Also Read: Former Wall Street Trader Has Now Been Sentenced To Prison

A Pattern of Leniency?

Susquehanna’s regulatory troubles are not isolated.

In 2024, the firm faced a $10,000 fine from FINRA for misreporting short call options and a $12,000 penalty from the Cboe for failing to report trades and allowing manipulative trading.

Additionally, Susquehanna was fined $62,500 by both Cboe and NYSE Arca for off-exchange options violations.

These recurring infractions, met with relatively minor fines, paint a picture of a firm undeterred by regulatory action.

Critics argue that FINRA’s enforcement approach lacks teeth, particularly when compared to international regulators.

For example, the UK’s Financial Conduct Authority (FCA) imposed a £390 million fine on UBS in 2012 for LIBOR manipulation, a penalty that sent shockwaves through the industry.

In contrast, FINRA’s fines often appear symbolic, failing to disrupt the operations of firms like Susquehanna.

The Susquehanna case has reignited calls for regulatory reform, with advocates urging FINRA and the SEC to adopt a more aggressive stance.

Proposals include:

Scaled Fines: Penalties proportional to a firm’s revenue or the economic impact of the violation.
Trading Restrictions: Temporary bans on certain activities, such as short selling or options trading, for repeat offenders.
Public Transparency: Mandatory disclosure of affected securities and trade volumes to ensure market accountability.
Personal Liability: Holding executives accountable for systemic failures, rather than solely penalizing the firm.

“Investors deserve a regulator that prioritizes their protection over industry relationships,” said consumer advocate Rachel Nguyen.

“Without meaningful consequences, firms like Susquehanna will continue to skirt the rules.”

FINRA maintains that its enforcement actions are designed to promote compliance and protect investors.

In a statement, the regulator emphasized that the Susquehanna fine is part of a broader effort to ensure accurate trade reporting, which is “essential for market integrity.”

However, FINRA’s recent “FINRA Forward” initiatives, announced on April 21, 2025, focus more on cybersecurity and fraud prevention than on escalating penalties for reporting violations, leaving some to question its priorities.

As retail investors increasingly rely on platforms like X and Reddit to voice their concerns, the pressure is mounting for FINRA and the SEC to address these criticisms.

Until then, fines like Susquehanna’s $100,000 penalty will continue to be seen as a slap on the wrist, doing little to deter misconduct or restore public trust.

But I’m curious to know what you think — leave your thoughts below.

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