The Securities and Exchange Commission has approved a plan (PDF) by the Nasdaq stock exchange to pay $62 million to investors. That sum covers the losses incurred during the bungled Facebook initial public offering (IPO) last year.

In May 2012, when the social network’s highly anticipated stock went public, there was an unexplained 30-minute delay before the stock began to be traded. By the time the stock was finally made available, a huge order volume overwhelmed Nasdaq.

According to the Wall Street Journal, banks are estimated to have lost around $500 million due to the “delay in the opening of Facebook trading and subsequent confusion over individual trades.” The kerfuffle didn’t fully resolve itself for three hours—an eternity in the age of high-frequency trading. Many banks, including UBS and Citigroup, have slammed the deal, adding that they will seek arbitration.

As Reuters reported at the time: “Orders that were supposed to be processed in three milliseconds were taking five milliseconds, said one person familiar with exchange operations. This proved to be a major problem: In the extra two milliseconds new orders flooded in, thwarting the system's ability to establish an opening price for the stock and leading to a backup in unprocessed orders.”

Needless to say, startup folks and bankers are decidedly ticked off about the shockingly low amount that they are being paid out. Meanwhile, TechCrunch wrote on Monday: “When Twitter or Dropbox go public, they should remember May 18, 2012… The debacle should push companies eying big IPOs to look at other exchanges.”