Nasdaq OMX Group Inc's $62 million compensation plan for firms harmed by technical problems during Facebook's market debut does not go far enough, broker-dealers said in U.S. Securities and Exchange Commission filings.

Firms that facilitated trades for retail clients say they lost upwards of $500 million in the $16 billion Facebook In IPO on May 18, and brokers like Vandham Securities Corp, based in Woodcliff Lake, New Jersey, argued in an August 21 filing Nasdaq should more fully compensate its members.

Nasdaq's systems initially delayed the offering, and when trading began at 11:30 a.m. at an opening price of $42, many investors were left in the dark for more than two hours on whether their premarket orders had gone through.

Many buy and sell orders did not actually go out until later in the day, while others, including cancellations, were lost altogether.

At issue in Nasdaq's proposal is the establishment of a benchmark price of $40.527 at which "a reasonably diligent member" could have acted to mitigate losses, it said.

Nasdaq said firms should have realized that some opening orders were not going to be filled when many, but not all orders, were executed at 1:50 p.m.

Nasdaq said firms should have cut losses by selling their positions into the market over the next 45 minutes.

Triad Securities Corp said in a separate filing on August 20 it believes "Nasdaq's theory of compensation is based on factual error," and should be increased.

Both Vandham and Triad said Nasdaq was telling its customers after the market closed on the day of the IPO that orders could be sold at an opening price of $42, so firms should not have been expected to take actions to sell their positions and cut their losses.

"Vandham requests that the Commission not approve the portion of Nasdaq's proposal that sets a limit on the amount that customer's losses will be reimbursed, but instead recommends that customers be reimbursed for their losses in full," the broker said in its filing.

Nasdaq's proposal also requires firms that sign on agree not to pursue legal action against the exchange.

Vandham proposed that firms should be able to opt into the settlement on an order-by-order basis, leaving options open.

The all-cash $62 million in reimbursements is $22 million larger than Nasdaq originally proposed. The prior proposal was made up mostly of trading rebates, which drew loud protests from other exchanges and market makers.

Hedge fund manager Citadel LLC called for the SEC to approve Nasdaq's $62 million proposal in a filing submitted on Tuesday.

The other top retail market-makers involved in the IPO were Swiss bank UBS AG, Knight Capital Group Inc, and Citigroup Inc's Automated Trading Desk.

Nasdaq shares lost 2 percent to $23.24 in afternoon trading.