By John McCrank
NEW YORK (Reuters) - Four of Wall Street's major market makers involved in Facebook's
A software error on Nasdaq OMX Group Inc's
The exchange operator is facing lawsuits from investors and threats of legal action from brokers.
Claims from market makers look to overwhelm the $13 million fund the exchange aims to set up to deal with potential claims. Nasdaq's liability is limited to $3 million in certain cases, but electronic trader Knight Capital Group, for one, has said it will fight to be fully compensated.
According to sources with knowledge of the situation:
* UBS AG
* Knight Capital Group
* Citadel Securities booked losses of $30 million; and
* Citigroup Inc's
A market maker is a firm that stands ready to buy and sell a particular stock on a regular and continuous basis at a publicly quoted price.
Other firms are expected to report additional losses from Facebook's IPO, including a $1 million loss by E*Trade Financial
Regulators, including the U.S. Securities and Exchange Commission, the Financial Industry Regulatory Authority and Massachusetts Secretary of the Commonwealth William Galvin are now looking into how the IPO was handled. The U.S. Senate Banking Committee is also reviewing the matter.
(Reporting By John McCrank; Writing by David Randall; Editing by Walden Siew and Kenneth Barry)