Wall Street Firms Charged $1.8 Billion

September 28, 2022 By Alberto Mesti

(Image Credit Google)

BBC reported that the US financial watchdogs recently penalized some of the most prominent Wall Street companies a combined $1.8 billion (around £1.7 billion) after discovering that employees discussed deals and trades on their personal devices and apps. According to the SEC (the US Securities and Exchange Commission), the probe uncovered "pervasive off-channel communications." In addition, among the 16 companies mentioned by the US regulators were Barclays (BARC.L), Bank of America, Citigroup, Credit Suisse (CSGN.S), Goldman Sachs, Morgan Stanley, and UBS (UBSG.S). Furthermore, according to BBC, the sweeping industry probe conducted last year is a "landmark" case for the SEC and Commodity Futures Trading Commission(CFTC). And it is also one of their largest collective resolutions. Wall Street Firms

Moreover, the SEC issued fines totaling $1.1 billion in separate releases on Tuesday, while the Commodity Futures Trading Commission said it had levied penalties totaling $710 million. Gary Gensler, the SEC chair, stated, "Finance, ultimately, depends on trust. Unfortunately, by failing to honor their recordkeeping and books-and-records obligations, the market participants we have charged today have failed to maintain that trust." More Details According to BBC, the regulators revealed bank employees routinely chatted about business matters with coworkers, clients, and other third-party advisers using apps on their personal devices, such as text messages and WhatsApp, from January 2018 through September 2021. Additionally, the Wall Street firms did not preserve most of those chats. And that violated federal regulations that require broker-dealers and other financial organizations to preserve such business communications. Hence, this made it more difficult for regulators to ensure compliance with key rules and acquire data for unrelated investigations, reported the agencies. Wall Street Firms

BBC reported that the probe dealt a devastating blow to Wall Street, with some bankers losing their jobs. However, it compelled businesses to implement strict new regulations to stop the unauthorized usage of apps.

By Alberto Mesti

Introvert. Eccentric at times. A fashion enthusiast, designer and writer. Lives for the drama, hates being at the centre of it. Can be best described as \'wannabe modern day Lady Whistledown\'.

Wall Street Firms Charged $1.8 Billion

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