WASHINGTON (MarketWatch)—A high-frequency trading firm on Thursday was fined for allegedly manipulating prices through a wave of last-minute orders, in what the Securities and Exchange Commission calls its first-ever manipulation case involving the hotly debated tactic.

Though the fine was a relatively small $1 million, and involved conduct from 2009, the case was considered significant enough internally to garner a prepared comment from SEC Chairwoman Mary Jo White, who said, “When high frequency traders cross the line and engage in fraud we will pursue them as we do with anyone who manipulates the markets.”

The actions of high-frequency trading firms were criticized in the popular Michael Lewis book “Flash Boys,” and have been a subject of intense controversy ever since. White has said the SEC will move carefully before changing stock-market rules in reaction to the HFT firms.

In the case against Athena Capital Research, which neither admitted nor denied the findings, the firm made a wave of orders in the final two seconds of almost every trading day for a six-month period.

The strategy, dubbed “Gravy” internally, involved over 70% of the trading volume in Nasdaq-listed stocks during that time period. Athena was alleged to have focused on order imbalances to move the prices of the stocks.

For instance, on Nov. 25, 2009, eBay EBAY, -0.06% was trading at $23.55 at 3:50 p.m. According to the SEC, Athena placed what was called a sell-imbalance order for 224,638 shares at a penny—so it wouldn’t immediately be executed—and a buy order of 85,300 shares at $23.56. In the next 9 minutes and 58 seconds, Athena bought another 64,000 shares, and then another 112,000 shares in the time period between 3:59:58 and 4 p.m.

With the orders, eBay’s stock went up to $23.59 at 3:59:58.51, and then $23.60 at 3:59:59.963.

In the closing auction, Athena’s eBay sell order was executed at $23.61.

In an internal email, a manager said: “We have a desired accumulation pattern which includes grabbing stock at the beginning, a period of ‘average price’ accumulation, and a crescendo at the end.”

Initially, Athena traded 1,000 to 3,000 symbols per month using this strategy, which grew to 12,844 at its peak in Nov. 2009.

For its part, Athena said it stopped the strategy due to “declining market demand for liquidity.”

“While Athena does not deny the Commission’s charges, Athena believes that its trading activity helped satisfy market demand for liquidity during a period of unprecedented demand for such liquidity,” the company said.

While it’s the agency’s first manipulation case against a high-frequency trading firm, the SEC last month punished Latour Trading for allegedly not holding enough capital.

Andrew Ceresney, director of enforcement at the SEC, defended the fact that the agency only took action now some five years after the alleged trading took place.

“There’s no question that these investigations take time, especially given the complex activity in this case,” he said.

He declined to quantify Athena’s profits from the strategy, and he said the SEC didn’t seek to get the firm to admit to the findings, as it has in some other cases.