SEC Charges 16 Financial Advisory Firms Over Recordkeeping Failures

Posted on October 17th, 2022 at 1:20 PM
SEC Charges 16 Financial Advisory Firms Over Recordkeeping Failures

From the Desk of Jim Eccleston at Eccleston Law.

The Securities and Exchange Commission (SEC) has charged 16 financial advisory firms over widespread failures by the firms and their employees to preserve electronic communications.

Each firm has acknowledged that their conduct violated recordkeeping rules and have agreed to pay a combined $1.1 billion in penalties. Barclays Capital, Bank of America Securities, Citigroup, Credit Suisse, Deutsche Bank Securities, Goldman Sachs, Morgan Stanley, and UBS have each agreed to pay penalties of $125 million. Furthermore, Jefferies LLC and Nomura Securities have each agreed to pay a $50 million penalty. Finally, Cantor Fitzgerald has agreed to pay a $10 million penalty. The firms cooperated with the SEC’s investigation by collecting communications from personal devices of a sample of the firm’s employees, including senior and junior investment bankers and equity traders.

According to the SEC, each of the firms’ employees regularly discussed business matters via test messaging applications on their personal devices between January 2018 and September 2021. Each of the firms violated federal securities laws by failing to preserve a substantial majority of these communications. The failure to preserve off-channel communications occurred across all 16 firms and included employees at several levels of authority, such as supervisors and senior executives.

Eccleston Law LLC represents investors and financial advisors nationwide in securities, employment, regulatory and disciplinary matters.

Tags: eccleston, eccleston law, advisors, law, sec

Return to Archive

TESTIMONIALS

Previous
Next

If the regulators are after you, and are trying to make a case against you, and you are going to contest their allegations against you, make sure you have the best securities industry defense lawyers, Eccleston Law Firm. My case was spun into a combination of penalties including fines, cash settlements, CE courses and suspension. They were the best I have seen in action. When all was said and done, they had done their magic, my situation was negotiated and settled with a simple "letter of caution" and a case closed without action. It is the most important legal business decision you will ever make, make it Eccleston Law.

Rick R.

LATEST NEWS AND ARTICLES

September 26, 2025
SEC and DOJ Target $770 Million Prestige Funds Ponzi Scheme

Federal regulators say thousands of investors may have lost money in what they allege was a massive Ponzi scheme tied to the Prestige Funds and WF Velocity Funds.

September 25, 2025
FINRA Suspends Spartan Capital Broker for Excessive Trading Violations

The Financial Industry Regulatory Authority (FINRA) has suspended Joseph Kelly, a broker at Spartan Capital Securities, for nine months and ordered him to pay a $10,000 fine and $69,830 in restitution.

September 24, 2025
How New CCOs Can Navigate Today's Compliance Challenges

The role of the chief compliance officer (CCO) has never carried more weight or more complexity, according to Wealth Management.