Financial watchdogs step up scrutiny of workplace communications • The Register

Authorities in the US and UK are showing keen interest in the content of WhatsApp messages from bank employees and their employees in the financial services industry.

The UK’s Financial Conduct Authority (FCA) will investigate the use of private messaging services by workers in the sector as the regulator steps up scrutiny in line with the US.

According to Bloomberg, the FCA has solicited information from Citigroup, Deutsche Bank, JPMorgan Chase and Nomura Holdings, among others, to inquire about the frequency and content of staff exchanges via SMS and messaging apps.

In an email to The registryAn FCA spokesman said: “We are actively discussing the use of personal devices with a number of UK-licensed firms, not just those who may have been subject to other regulatory investigations. We are unable to comment on company-specific regulatory issues at this time.”

In September, 11 of the world’s most powerful financial firms were fined nearly $2 billion for off-channel communications. Banking giants including Goldman Sachs, Credit Suisse and Citigroup have agreed to pay the SEC $1.1 billion in fines and the Commodity Futures Trading Commission (CFTC) $710 million in fines for breaching their Failed to monitor and prevent employees from using unauthorized messaging applications.

The action followed a months-long dispute between federal authorities and the banks, culminating in fines that many criticized as too small to be a real deterrent.

However, the FCA is not new to sanctions based on WhatsApp communications. In 2017, it fined Christopher Niehaus, a former investment banker, £37,198 for sharing confidential customer information via WhatsApp.

The watchdog found that Niehaus, then a chief executive at Jefferies International, had used the messaging app to obtain sensitive information in 2016 and shared it with both a personal acquaintance and a friend who was also a customer of the company .

In the United States, the Securities and Exchange Commission (SEC) is expected to expand its interest in work-related communications from traders on personal devices and apps like WhatsApp to mutual funds and advisors, Reuters has reported. ®

https://www.theregister.com/2022/10/13/whatsapp_trader_comms_regulation/ Financial watchdogs step up scrutiny of workplace communications • The Register

Rick Schindler

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