According to FINRA, HRT Financial LP was censured, fined $110,000, and ordered to pay disgorgement of $233,445 plus interest for over-tendering shares in a partial tender offer. The firm had a net long position of 164,920 shares but tendered 350,000 shares without accurately calculating its position. Instead, the firm relied solely on the long equities position in one aggregation unit, resulting in over-tendering 185,080 shares.

After applying the proration factor, 13,569 of the over-tendered shares were accepted, resulting in ill-gotten gains of $233,445 for the firm. The firm also lacked any supervisory system or written procedures for achieving compliance with Exchange Act Rule 14e-4, which prohibits over-tendering in partial tender offers. This rule exists to prevent market manipulation and ensure fair treatment of all shareholders.

Over-tendering in partial tender offers can harm other shareholders by reducing their ability to participate in the offer. When firms tender more shares than they own, they effectively game the system at the expense of legitimate shareholders. The prohibition on over-tendering ensures that tender offers operate fairly and that all shareholders have equal opportunity to participate.

This case demonstrates the importance of accurate position tracking and compliance systems. Even sophisticated trading firms can make costly errors when they lack proper controls. The requirement for disgorgement ensures that firms cannot profit from regulatory violations. Investors benefit when FINRA enforces these rules strictly, as it maintains the integrity of tender offer processes and protects shareholder rights.