Latour Trading LLC, a high-frequency trading firm registered with the Securities and Exchange Commission as a broker-dealer was charged with violating SEC minimum net capital and recordkeeping requirements on 19 month-end reporting days from January 2010 through December 2011. The SEC claimed this violation occurred because the firm failed to take proper haircuts against its capital, as required, in connection with proprietary positions. According to the agency, on the relevant dates, the firm had net capital deficiencies from US $2 to $28 million. The SEC charged that Latour—in connection with its trading of exchange traded funds and the component securities—under-computed its haircuts (and thus overstated its amount of regulatory capital) because it (1) incorrectly reflected hypothetical positions it did not hold as offsets to certain proprietary positions; (2) used incorrect data regarding the components of certain international indices it tracked; (3) failed to account properly for certain futures positions; and (4) failed to take some haircuts because of a computer programming error. As part of this action, the SEC also charged Nicolas Niquet, who was the firm’s chief operating officer during most of the relevant time, with the firm’s violations, claiming that, at least in some cases, it was his errors and mistakes, that were the cause of the firm’s regulatory violations and that he “knew or should have known that his conduct …would contribute to the violation.” In settling the charges, Latour agreed to pay a civil fine of US $16 million, and Mr. Niquet agreed to pay sanctions of US $150,000.