SEC Drops New Wave of WhatsApp Fines on BDs, Advisory Firms

The firms did not maintain or preserve the substantial majority of these off-channel communications, in violation of federal securities laws, the SEC states.

By failing to maintain and preserve required records, some of the firms likely deprived the SEC of these off-channel communications in various SEC investigations.

The failures involved employees at multiple levels of authority, including supervisors and senior managers.

“Interactive Brokers, Baird, William Blair, Nuveen, Fifth Third, Perella Weinberg, and TPH were each charged with violating certain recordkeeping provisions of the Securities Exchange Act of 1934 and with failing to reasonably supervise with a view to preventing and detecting those violations,” the SEC said.

Baird, William Blair, WBIM, Fifth Third, and Perella Weinberg Capital “were each charged with violating certain recordkeeping provisions of the Investment Advisers Act of 1940 and with failing to reasonably supervise with a view to preventing and detecting those violations,” according to the SEC.

Each of the firms was ordered to cease and desist from future violations of the relevant recordkeeping provisions and was censured.

The firms also agreed to retain independent compliance consultants to, among other things, conduct comprehensive reviews of their policies and procedures relating to the retention of electronic communications found on personal devices and their respective frameworks for addressing non-compliance by their employees with those policies and procedures, the SEC explained.