- Chief Compliance Officer and VP of Legal Affairs, Arrow Electronics
By 
Kyle Brasseur2023-09-29T15:31:00
A dozen financial services firms were penalized by the Securities and Exchange Commission (SEC) as the agency continues its enforcement sweep of recordkeeping violations regarding employee use of off-channel communications for business purposes.
The latest round of fines announced Friday targeted broker-dealers, investment advisers, and credit rating agencies. The largest penalty the SEC assessed was $35 million against Interactive Brokers Corp. and its affiliate Interactive Brokers LLC. The Commodity Futures Trading Commission (CFTC) also fined Interactive Brokers $20 million.
The CFTC did not levy any additional penalties against firms disciplined by the SEC. In previous sweeps, the agencies combined to dish out fines totaling $200 million or more to many of the world’s largest banks, including Bank of America, Barclays, Citi, Credit Suisse, Deutsche Bank, Goldman Sachs, Morgan Stanley, UBS, and Wells Fargo.
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The Securities and Exchange Commission and Commodity Futures Trading Commission have combined to levy about $2.8 billion in penalties (so far) against firms and their affiliates in response to recordkeeping failures regarding employee use of off-channel communications for business purposes.
A New York state law that takes effect next year will make it more difficult for registered investment advisers in the state to conduct proactive testing for violations of their firms’ off-channel communication policies.
Businesses must step up their internal policing and do a better job of reporting violations to the Securities and Exchange Commission, according to Gurbir Grewal, director of the agency’s Enforcement Division.
Three former executives of Chicago-based Outcome Health, a healthcare technology company, were sentenced for misleading an auditor, clients, lenders, and investors about a scheme to sell $45 million in overbilled advertisements.
A home health company operating in Indiana, Ohio, and Texas agreed to pay nearly $4.5 million to settle allegations it filed false claims by giving sports tickets and other kickbacks to assisted living facilities in exchange for referrals.
Crypto-friendly Silvergate Bank will pay a total of $63 million penalties to California and the Federal Reserve Board to settle charges that its anti-money laundering program failed to properly monitor more than $1 trillion worth of customer transactions.
