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



I learned two important things working with Eccleston Law. First, I made a friend and ally with Jim and Steph for life. Secondly, and this is a crucial life lesson - if you need counsel, then seek out the very best. Jim was referred to me by a most trusted source. I've never had to hire an attorney for anything. Now, I know the value of hiring an important partner. Meticulous, thorough and detailed in preparation is the best way to describe Jim. Brilliant too, I might add. Bottom line, I would highly highly recommend Jim and Stephany for your legal needs. One of the best life decisions I've ever made.

Howard S.


June 14, 2024
Wells Fargo Fires Employees for Faking Work

Wells Fargo & Co. recently terminated over a dozen employees following an investigation into allegations of fake work activities.

June 13, 2024
FINRA Struggles to Revise Outside Business Rules

The Financial Industry Regulatory Authority’s (FINRA) attempt to update its rules on advisors’ outside business activities has stalled, according to Robert Colby, FINRA's chief legal officer.

June 12, 2024
Tax Court Denies Madoff Victims $8.2 Million Deduction

Victims of Bernie Madoff's Ponzi scheme, Christopher and Silvana Pascucci, cannot claim an $8.2 million tax deduction for their investment in life insurance premiums.