Regulators approve Facebook IPO payout US regulators have approved a proposal by Nasdaq OMX to pay out $62m to compensate broker-dealers who lost out from the exchange operator's botched handling of the Facebook initial public offering last year. The Securities and Exchange Commission on Monday passed a proposed rule-change by Nasdaq, which will allow the exchange to raise the total it was able to offer brokers. The much-anticipated IPO last May was marred by a series of system failures on the US's second-largest equity exchange. Nasdaq said later that a 20-minute delay to the start of trading of Facebook's $16bn debut had been caused by a millisecond systems blip due to the largest IPO auction "in the history of mankind." However, brokers said the glitches left them with combined losses of $500m. Nasdaq's legal status as a self-regulatory organisation meant it was capped at offering compensation of $3m for technical issues. Payouts under the Nasdaq proposal will be evaluated and processed via the Financial Industry Regulatory Authority, the SEC added. "While the accommodation proposal is not designed to, and would not, compensate all claims of loss suffered by market participants relating to Nasdaq's system difficulties with the Cross, [it] would create a means of providing significantly more compensation for eligible claims, outside of litigation, than would otherwise be available under existing Nasdaq [rules]," the SEC said in a statement. The SEC agreed that Nasdaq was not liable for any losses or damages. However, the larger payout underlines how Nasdaq has sought to repair relations with traders and reassure the market on the reliability of its technology. A Nasdaq spokesperson said: "We are pleased that the Securities and Exchange Commission has approved our accommodation plan, which will enable Finra to promptly begin processing claims." The SEC had come under pressure from banks such as Citigroup and UBS to reject the plan. Others such as Knight Capital and Citadel urged the SEC to approve the plan after Nasdaq improved its initial offer.