System Duplicated Execution Reports, 116 Accounts Affected
FSC Securities and Futures Bureau Deputy Director-General Huang Hou-ming said Waterland Futures reported the incident on the morning of the 23rd, with a preliminary count of 116 accounts affected. The glitch occurred in execution-reporting operations: an investor placed 1 order with 1 actual execution, but the system may have reported 2 executions. No duplicate executions occurred. The accounting system was repaired in the early hours of the 23rd. The TAIFEX will conduct an on-site inspection on the 28th to clarify the cause and whether there were deficiencies in information systems and internal controls.
Gains and Losses to Be Determined Based on 45895 Points
Waterland Futures has announced to clients that calculations will be based on TAIEX futures at 45895 points at 11 p.m. on October 22. Transactions executed after 11 p.m. that night will be handled by calculating gains and losses from the benchmark point through to each client's final liquidation, while pre-existing entry orders executed earlier will be calculated in segments. Some investors reported holding 1 long lot, showing 1 short lot still held after selling 1 lot, and incurring losses after TAIEX futures gapped higher at Tuesday's open. Other investors reported positions still appearing after liquidation and being unable to reach the dealing desk.
Erroneous Reports May Mislead Trading Decisions
Speaking at the FSC's regular press conference, Huang Hou-ming said duplicate reporting differs from duplicate execution. In theory, with no remaining position available to close, it would not create new execution losses, but erroneous reports could cause investors to misjudge their holdings, confuse trading decisions, and affect the accuracy of account information and investor rights. On the issue of unreachable dealing-desk phones, he responded that futures firms should deploy adequate and qualified business personnel, and the TAIFEX will also review staffing and client-service arrangements during this inspection.
TAIFEX Inspection on the 28th, Maximum Fine of NT$2.4 Million
Huang Hou-ming said if the cause proves straightforward, the TAIFEX is expected to complete its inspection report promptly and submit it to the FSC. Whether penalties follow will depend on the findings. Under relevant rules, if a futures firm is found to have violated internal-control and related requirements, it may face a fine of NT$120,000 to NT$2.4 million, with the results to be publicly disclosed. The FSC will continue to supervise firms' implementation of risk-control mechanisms, including futures brokers' checks on client margins and equity balances, to safeguard trading order and investor rights.