More than two dozen Wall Street firms, including Bank of New York Mellon and Truist, have agreed to pay a huge collective fine to US regulators.
The financial companies are handing over more than $470 million to the U.S. Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) to settle charges that the companies failed to comply with record-keeping rules.
According to the SEC, the companies admitted to using “off-channel” work communications in violation of federal securities laws.
“The inability to maintain and maintain required records deprives the SEC of these communications in its investigations.”
BNY Mellon agreed to pay $40 million to the SEC, while Truist would provide $5 million to the SEC and $3 million to the CFTC.
Financial service providers Ameriprise Financial Services,
Meanwhile, Toronto Dominion (TD) Bank has agreed to pay $75 million to the CFTC. In addition, TD Bank-owned Cowen and Company will pay a $3 million fine to the CFTC.
Other companies paying fines to US regulators for accounting violations include Royal Bank of Canada (RBC) Capital Markets, Osaic Services, Piper Sandler & Co, First Trust Portfolios, Apex Clearing Corporation, Cetera Advisor Networks, Great Point Capital , Hilltop Securities , P. Schoenfeld Asset Management and Haitong International Securities (USA).
According to the SEC, some companies have made efforts to self-report their record-keeping violations, resulting in significantly reduced civil penalties.
Says Gurbir S. Grewal, Director of the SEC’s Division of Enforcement:
“We remain committed to ensuring compliance with the accounting and recordkeeping requirements of the federal securities laws, which are essential to investor protection and well-functioning markets.
Among this group of companies, several have distinguished themselves through pre-employee self-reporting, demonstrating once again the real benefits of proactive collaboration.”
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