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SEC fines 16 firms $81M over texting violations

In the last few years the U.S Securities and Exchange Commision (SEC) has been increasingly handing out fines for improper use of consumer messaging apps such as WhatsApp, iMessage and Signal. It comes as no surprise that last week sixteen firms were hit with fines up to $81M in texting fines. Many prominent companies such as JPMorgan Chase and Morgan Stanley have previously received eye-watering fines for not adhering to SEC guidelines regarding the misuse of such applications, with the latest fines being handed out as follows:

  • NMIS, NMIM, and Mason Street Advisors LLC: $16.5M penalty. 
  • Guggenheim Securities LLC and GPIM: $15M penalty.
  • Oppenheimer & Co. Inc.: $12M penalty. 
  • Cambridge Investment Research Inc. and Cambridge Investment Research Advisors Inc.: $10M penalty. 
  • KIS and KeyBanc Capital Markets Inc.: $10M penalty. 
  • Lincoln Financial Advisors Corp. and Lincoln Financial Securities Corp.: $8.5M penalty. 
  • U.S. Bancorp Investments Inc.: $8M penalty. 
  • HIC, HSI, and Capstone Capital Markets LLC (self-reported): $1.25M penalty.

SEC said its investigation into the firms uncovered “pervasive and longstanding uses of unapproved communication methods.”  These latest fines were regulators’ latest effort to eradicate the use of improper and non-compliant communication from employees within a business.

Many of these prominent companies spend millions of dollars on IT security systems like firewalls, email security, VPNs and DLP, but despite these concerted efforts, the continuous use of consumer messaging apps are a real threat for large financial organisations, both from a compliance and security perspective. 

The issue at hand is clear, businesses need channels of communication within their staff at all levels, however the use of consumer messaging apps cannot provide a safe and secure platform for this. The solution in theory is simple, organisations need to eliminate the use of these non-compliant apps whilst providing their staff with a viable alternative that is safe and secure, and adheres to SEC guidelines. 

In response to these challenges businesses can turn to Salt Communications’ secure and compliant communications network. Salt is working with institutions across the globe to provide an alternative to unsafe consumer messaging apps to give both businesses and their customers peace of mind that their precious data is compliant as well as safe from malicious attackers. As the financial landscape evolves and regulatory scrutiny intensifies, financial institutions must prioritise their secure communications to protect themselves, their clients, and the integrity of the market they serve. Adopting Salt’s robust security measures not only mitigates the risk of SEC fines but also contributes to a resilient and trustworthy financial ecosystem. 

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