U.S. regulators are poised to announce a settlement with firms across Wall Street for failing to monitor employees using unauthorized messaging apps.
The Securities and Exchange Commission and the Commodity Futures Trading Commission are preparing to disclose the results of the investigation as soon as Wednesday that could see them extracting total fines of around $2 billion, according to a person with knowledge of the matter as well a review of disclosures made by the world’s largest banks.
A representative for the SEC declined to comment and a representative for the CFTC didn’t immediately respond to requests for comment.
The action represents a rare escalation from regulators looking into such an issue, with fines tending to be significantly lower in the past. The sweeping civil probes rank among the largest-ever penalties levied against U.S. banks for record-keeping lapses, dwarfing a $15 million penalty imposed on Morgan Stanley in 2006 over its failure to preserve emails.
Morgan Stanley said in July it was nearing a settlement that would see it pay a $200 million fine — a figure that was likely to be mirrored by its biggest rivals. Other major banks also disclosed setting aside similar figures at the end of their second-quarter earnings without specifying the reason. JPMorgan Chase & Co. has been the only bank until now to reach a settlement with the regulators, and was the first to report the fines in December.
Finance firms are required to scrupulously monitor communications involving their business to head off improper conduct. That system, already challenged by the proliferation of mobile-messaging apps, was strained further as firms sent workers home shortly after the start of the Covid-19 outbreak.
Prometheum's Aaron Kaplan on why clearing ETH inside a US brokerage account changes the conversation and what still needs to happen before adoption scales.
The tools are evolving rapidly, but in wealth management, the real challenge isn’t access. It’s integration, security, and discipline.
Chirayu Rana’s lawsuit has garnered massive attention on Wall Street.
Terrance L. Hayes was arrested April 20 and charged with two felonies.
People are living longer, but new research warns that many may outlive their savings.
According to Flyer Financial Technologies, rising portfolio complexity is exposing the limits of legacy infrastructure and widening the gap between automation and reality
In volatile markets, the advisors who win aren't the ones with the best calls - they're the ones whose clients stay the course.
