Business & Investment

Exclusive-US SEC Begins Investigation into Communication of Wall Street Bank Staff-Source by Reuters

© Reuters. File Photo: The sign will be seen on May 12, 2021 at the US Securities and Exchange Commission (SEC) headquarters in Washington, DC, USA. REUTERS / Andrew Kelly


Chris Prentice and Jody Godoy

Washington (Reuters)-The US Securities and Exchange Commission (SEC) has launched an extensive investigation into how Wall Street banks are tracking employee digital communications, three people familiar with the matter told Reuters. Told.

For those who spoke on anonymous terms, SEC executive staff have contacted multiple banks in recent weeks to ensure that employee work-related communications such as text messages and emails are focused on personal devices. I checked if it was documented in. ..

An industry “sweep” is a further sign that the SEC is stepping up enforcement under democratic leadership and is faced by Wall Street banks as they track staff communications during a telecommuting pandemic. It highlights the challenges.

The SEC will perform regular sweeps to quickly gather information on issues that may be widespread. Sweeps, but not always, can lead to formal probes.

Sources say the sweep has its roots in a survey conducted by agencies on individual financial institutions for some time.

In August, JP Morgan Chase and Company (NYSE :) responded to regulatory inquiries regarding “compliance with record keeping requirements related to business communications transmitted over electronic messaging channels” that the bank did not approve. I made it clear that I was doing it. It said it was discussing a “solution” with the regulator without identifying which regulator.

SEC and JP Morgan spokespersons declined to comment.

The SEC and Wall Street’s self-regulatory body, the financial industry regulator, require broker-dealers to keep a record of all business-related communications. Banks need to take great care to comply with these requirements without invading employee privacy, according to one source.

In the United States, there is no clear legal basis for an employer to require an employee to inspect personal communication, but in other countries doing so can violate data protection legislation.

As a result, many financial companies have banned the use of personal email, text, and other social media channels for work purposes, but responding to the proliferation of communication apps, especially during a pandemic, is a company. Is a challenge for.

In a speech last week, SEC executive officer Gurbir Grewal said agencies need to be aware of “increasing use of personal devices, new communication channels, and issues raised by other technological developments.” I warned you. For Speech-https: //

Failure to keep and create communication records could hinder regulatory investigations, Grewal said in a statement.

last year, Morgan Stanley (NYSE :) We fired two executives because WhatsApp was misused to discuss work issues.

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Exclusive-US SEC Begins Investigation into Communication of Wall Street Bank Staff-Source by Reuters Exclusive-US SEC Begins Investigation into Communication of Wall Street Bank Staff-Source by Reuters

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