NYSE parent company fined $10M by SEC for not reporting cyberattack

The Intercontinental Exchange faces a penalty for not promptly disclosing a cyber intrusion. This enforcement action impacted multiple ICE subsidiaries, including the New York Stock Exchange.

ICE will incur a $10 million penalty for its failure to promptly report a cyber intrusion, as per the United States Securities and Exchange Commission (SEC). The breach, detected in April 2021, utilized malicious code to breach a virtual private network (VPN) device and access ICE’s corporate network.

Although ICE swiftly recognized the threat, it neglected to inform legal and compliance officials at its subsidiaries, such as the New York Stock Exchange, for multiple days. This violates the agency’s Regulation Systems Compliance and Integrity (Regulation SCI), which mandates companies to immediately disclose significant cybersecurity incidents to the SEC.

ICE stands as the cornerstone of the world’s most expansive network of exchanges and clearing houses. Within its subsidiaries are renowned exchanges such as the New York Stock Exchange (NYSE), ICE Futures U.S. and Europe, in addition to clearing houses and data providers.

The SEC’s enforcement action impacted multiple subsidiaries of ICE, including Archipelago Trading Services Inc, New York Stock Exchange LLC, NYSE American LLC, NYSE Arca Inc, ICE Clear Credit LLC, ICE Clear Europe Ltd, NYSE Chicago Inc, and NYSE National Inc. Additionally, the Securities Industry Automation Corporation consented to a cease-and-desist order along with a monetary penalty.

In reaction to the fines, SEC Commissioners Hester Peirce and Mark Uyeda issued a statement describing the fine as an “excessive response” to a “minor incident.”

Peirce and Uyeda suggest that the fine gives the impression that the SEC’s penalty system prioritizes numerical quotas over effectively fostering market integrity. Commissioners have previously voiced concerns about the SEC’s treatment of crypto companies.

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