Texting Employees Cost Wall Street Firms $549M In Fines For Recordkeeping Rules Violation

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Updated August 08, 2023

10:42 AM EDT

Federal Hall and Wall Street with statue of George Washington — Bo Zaunders / Getty Images

How much does it cost to send a t﷽ext message? For 11 trading firms, the practice of their employees texting about work on their personal devices has cost a combined $549 million in fines from federal regulators.

Key Takeaways

Wells Fargo and other Wall Street trading firms have agreed to pay $549 in fines to federal regulators for violating rules that require them to preserve electronic communications.
Company employees used personal devices to send work-related text messages, making communications less available for investigators looking into potential wrongdoing, the Securities and Exchange Commission said.
The fines are part of an ongoing effort by federal regulators to make financial companies comply with communications rules: last year, other major firms had to pay nearly $2 billion for similar violations.

The Securities and Exchange Commission (SEC) and the Commodities Futures Trading Commission (CFTC) said Tuesday the companies had agreed to pay a a total of $549 million in fines to settle charges that they had violated recordkeeping rules. Longstanding patterns of employees communicating about work on personal devices on iMessage, WhatsApp, Signal, and other text messaging services violated regulations, the SEC said.

Among the firms targeted: Wells Fargo (WFC), which was fined $200 million by SEC and CFTC combined, and BNP Paribas (BNPQY), which faceဣd $110 million in fines b🐭etween the two regulators.

Trading firms are required to preserve electronic communications so that regulators can investigate potential lawbreaking. In September, the SEC and CFTC leveled nearly 澳洲幸运♛5官方开奖结果体彩网:$2 billion in fines against 16 other companies, including Bank of America (BAC) and Goldman Sachs (GS), for similar violations.

“Today’s actions stem from our continuing sweep to ensure that regulated entities, including broker-dealers and investment advisers, comply with their recordkeeping requirements, which are essential for us to monitor and enforce compliance with the federal securities laws.” Sanjay Wadhwa, Deputy Director of Enforcement for the SEC, said in a statement. “Recordkeeping failures such as those here undermine our ability to exercise effective regu👍latory oversight, often at the expense of investors,”

Firms Fined By The SEC:

Wells Fargo Securities with Wells Fargo Clearing Services, and Wells Fargo Advisors Financial Network: $125 million
BNP Paribas Securities: $35 million
SG Americas Securities: $35 million
BMO Capital Markets: $25 million
Mizuho Securities USA: $25 million
Houlihan Lokey Capital: $15 million
Moelis & Company: $10 million
Wedbush Securities: $10 million
SMBC Nikko Securities America: $9 million

Firms Fined By The CFTC:

BNP Paribas S.A. and BNP Paribas Securities: $75 million
Société Générale SA and SG Americas Securities: $75 million
Wells Fargo Bank and Wells Fargo Securities: $75 million
Bank of Montreal (BMO): $35 million

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Key Takeaways

Firms Fined By The SEC:

Firms Fined By The CFTC:

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