When will they realize fines are not a deterrent?
SEC Charges 11 Wall Street Firms with Widespread Recordkeeping Failures and agreed to pay combined penalties of $289 million. Wedbush Securities, Houlihan Lokey, SMBC Nikko, SG Americas, Moelis, Wells Fargo, Mizuho, BMO, BNP Paribas
CFTC Alert! CFTC Orders BNP Paribas ($75m), Société Générale ($75m), Wells Fargo ($75m), & Bank of Montreal ($35m) to pay a total of $260 Million for Recordkeeping and Supervision Failures for Widespread Use of Unapproved Communication Methods (personal text or WhatsApp, not maintained for records)
To date, the Commission has brought 30 enforcement actions and ordered over $1.5 billion in penalties to drive this foundational message home.
Since December 2021, the CFTC has imposed $1.091 billion in civil monetary penalties on 18 financial institutions for their use of unapproved methods of communication
"However, we know that other SEC-regulated entities have committed similar violations, and so our work to enforce industry-wide compliance continues.”
- Gurbir S. Grewal, Director of the SEC’s Division of Enforcement 8/8/23
It’s time for Wall Street and large foreign banks operating in U.S. markets to stop waiting for an enforcement action before they change illegal practices. The illegality that the CFTC found in all of these cases was disturbingly widespread, evasive, conducted by senior officials as well as those responsible for compliance, and a clear violation of the law and internal bank policies. It was well known within these banks that their internal policies were being flagrantly violated in practice. But no one stopped it. In the future as more time passes from these enforcement actions, and as there is adoption of new technologies and evolving means of private communication, I am concerned that there again will be a temptation for some to evade regulatory requirements and keep the CFTC in the dark.
-Commissioner Christy Goldsmith Romero 8/8/23
The only way any of this changes is if the fines and deterrents are greater than the cost of doing business--that is clearly not happening here, correct?