Wells Fargo & Co. and BNP Paribas are among firms that will pay hundreds of millions of dollars total in penalties for employees using unofficial communications like WhatsApp to conduct business — the latest salvo in U.S. regulators’ crackdown on how Wall Street keeps records.
Wells Fargo units agreed to pay $125 million to the Securities and Exchange Commission and BNP will pay $35 million, the regulator said Tuesday. Meanwhile, the two lenders will pay $75 million each over similar violations by their derivatives brokerage units, the Commodity Futures Trading Commission said.
In all, the CFTC announced penalties of $260 million, while the SEC said that firms had agreed to pay it $289 million.
Over the past several years, the SEC and CFTC have been cracking down on firms skirting regulatory scrutiny by using services such as WhatsApp or personal email addresses for work-related communications. Finance firms are required to scrupulously monitor communications involving their business to head off improper conduct.
Regulators have said that failing to properly archive messages can make it harder to investigate wrongdoing.
On Tuesday, the SEC said that its investigation “uncovered pervasive and longstanding off-channel communications” at 11 firms. As part of the settlements, the companies admitted that their employees had used platforms like iMessage, WhatsApp and Signal to talk business. The companies didn’t maintain sufficient records, according to the SEC. The CFTC said it found similar violations.
Other notable firms that agreed to settle on Tuesday included units of Bank of Montreal, Mizuho Financial Group and Societe Generale.
The actions follow a string of similar high-profile cases released last September. At the time, the SEC announced $1.1 billion in fines against firms including Bank of America Corp., Citigroup Inc. and Goldman Sachs Group Inc., while the CFTC said firms agreed to pay $710 million in penalties.
The move to charge data aggregators fees totaling hundreds of millions of dollars threatens to upend business models across the industry.
The latest snapshot report reveals large firms overwhelmingly account for branches and registrants as trend of net exits from FINRA continues.
Siding with the primary contact in a marriage might make sense at first, but having both parties' interests at heart could open a better way forward.
With more than $13 billion in assets, American Portfolios Advisors closed last October.
Robert D. Kendall brings decades of experience, including roles at DWS Americas and a former investment unit within Morgan Stanley, as he steps into a global leadership position.
Orion's Tom Wilson on delivering coordinated, high-touch service in a world where returns alone no longer set you apart.
Barely a decade old, registered index-linked annuities have quickly surged in popularity, thanks to their unique blend of protection and growth potential—an appealing option for investors looking to chart a steadier course through today's choppy market waters, says Myles Lambert, Brighthouse Financial.
