Goldman Sachs was prevented from participating in the 9th September auction of three-month U.S. Treasuries because of a malfunction with the government’s online order system, according to a person with direct knowledge of the matter.
Bloomberg reports one bidder couldn’t participate in the sale of three-month bills due to a 'technical error' with the government’s TAAPS system, the Treasury’s Bureau of Public Debt said 10th September on its website.
Goldman Sachs was the firm that was locked out, according to a person briefed on the event, who asked not to be identified because the discussions were private.
The disruption in the Treasury auction comes as U.S. regulators press for improvements in the infrastructure of American equity and derivatives markets. Following Nasdaq OMX Group Inc.’s three-hour trading halt on 22nd August, Securities and Exchange Commission Chairman Mary Jo White told U.S. stock markets on 12th September to collaborate on bolstering technology systems. On 9th September, U.S. Commodity Futures Trading Commission requested industry input on safeguarding markets.
The Bureau of Public Debt 'continues to test its systems to maintain the smooth functioning of Treasury auctions', it said on 10th September. The government said attempts to address the 9th September malfunction 'ultimately resulted' in the bidder buying more than 35% of the six-month bills that were sold, which normally isn’t allowed.
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