Five US investment banking giants could be fined $1 billion for failing to monitor employees using unauthorized messaging apps.
Both Morgan Stanley and JP Morgan expect to pay a $200 million fine as authorities use that figure as a guideline for the industry, according to a Bloomberg report. Citigroup has a reserve consistent with what other banks have disclosed.
Bank of America and Goldman Sachs have had advanced discussions with regulators, with a similar amount to be paid, according to the report.
As this file is in progress and not finalized, these figures could change.
Financial institutions are bound by strict communication monitoring rules and with the rise of the pandemic, many have turned to other messaging services that lack the necessary monitoring tools.
In December, the SEC and CFTC fined JP Morgan $200 million, saying even chief executives and senior supervisors ignored regulatory oversight by using WhatsApp or personal email addresses for related communications. at work.
The total amount of fines could increase. The SEC and CFTC obtained information from other companies, including HSBC and Deutsche Bank.
Earlier this year, Deutsche Bank told staff never to delete messages and is releasing new software on company phones that archives WhatsApp messages, Bloomberg said.
A recent SteelEye report found that only 15% of financial firms monitor WhatsApp, despite increasing fines for communication monitoring failures. He surveyed 170 compliance professionals and found that only 9% of companies monitor Slack and 3% monitor Signal.
While communications monitoring was better for Microsoft Teams, only 40% of companies pick it up, while only 25% of companies pick up Zoom.
He added that 76% of financial services firms rank surveillance among their top two investment priorities for the next 12 months, with 41% focusing on communications surveillance.
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