Taishin Securities Inventory Display System Abnormal; FSC to Re-inspect if Duplicate Orders Recur

(CNA, Taipei, 21st, by reporter Su Su-yun) Following the merger of Taishin Securities and Grand Fortune Securities on April 6, frequent system problems have been reported. The Financial Supervisory Commission (FSC) stated that the firm mentioned it performed a system optimization yesterday, leading to an abnormal inventory display on its app today, which was resolved within two hours. The FSC has asked the firm to confirm whether duplicate order issues occurred, and if so, the Taiwan Stock Exchange (TWSE) will conduct another on-site inspection. After the April 6 merger, Taishin Securities experienced multiple system abnormalities, including a system slowdown on April 7 due to a full database capacity. On the 14th, another system program abnormality occurred, causing a halt in transaction confirmation reports and leading many investors to place duplicate orders, resulting in erroneous trades. On the 20th, its 'PhoneEZ' app was also reported to be abnormal. Taishin Securities reported a total of approximately 9,321 erroneous trades, with the declared value of these trades reaching NT$2.011 billion and the actual loss amounting to about NT$43 million. Huang Chung-Hao, Deputy Director-General of the FSC's Securities and Futures Bureau, explained that Taishin Securities experienced an abnormality after the market opened at 9 a.m. today. The brokerage explained that due to yesterday's system optimization, some investors' app inventory displays were abnormal. The system returned to normal around 10:04 a.m. today. The brokerage reported the system issue, and it was resolved within two hours, not meeting the criteria for a major cybersecurity incident. However, the TWSE will be asked to investigate the cause further. Huang pointed out that the current understanding is that the issue was an abnormal app inventory display, while the order placement and trading functions were not affected. If investors experience duplicate order issues in the future, an on-site inspection will be initiated again. Huang noted that the TWSE has already fined Taishin Securities twice, with a total penalty of NT$3.31 million. The first was a fine and penalty of NT$1.31 million for delays in reporting operations due to a system abnormality, and the second was a penalty of NT$2 million for internal control deficiencies. The TWSE also issued warnings to the general manager, chief information security officer, and head of the channel division, calling it 'a major warning,' with further actions to be handled internally. When asked by the media about potential future fines from the FSC, Huang explained that the TWSE has submitted its inspection report to the FSC and has asked Taishin Securities to provide a statement regarding its negligence. The next step will be a meeting to discuss administrative penalties, and the firm will be required to track its improvement progress. The FSC may impose a fine of up to NT$6 million under the Securities and Exchange Act, depending on the severity of the deficiencies. Regarding market rumors of frequent personnel changes at Taishin Securities affecting system stability, an official from the Securities and Futures Bureau explained that the firm mentioned a single-digit number of backend staff had resigned, but they were supported by others within the group, and backend operations were not affected. (Edited)