The Treasury had noticed irregularities in the February auction, where Salomon Brothers admitted to filing an unauthorized bid on behalf of a customer, a Treasury official said.

To do this, Salomon has said, the traders submitted unauthorized bids in customers' names.

The rules limit any one bidder to 35 percent of the securities sold at any one auction; Salomon exceeded the limit, by placing unauthorized bids for clients.

But Salomon's bombshell confession about unauthorized bids came in mid-August.

In February, Salomon submitted three bids for 35 percent of the five-year notes, two of which were unauthorized bids in customers' names.

In early August, Salomon disclosed that it had illegally purchased more than the 35 percent limit at several Treasury auctions by submitting unauthorized bids.

The unauthorized bids were placed in order to buy more than the 35 percent of the securities offered that the firm was allowed to purchase.

The unauthorized bid apparently went undetected.

The most publicized was Salomon Brothers' placing of unauthorized bids in clients' names to gain a larger-than-allowed share of securities in several Treasury auctions.

With an Ebay screen name and password, an intruder could place unauthorized bids and start bogus auctions while impersonating an unsuspecting victim.