Bank will pay US$30-million to CFTC and US$12-million to SEC; Canaccord Genuity also fined by SEC
has become the last of Canada’s largest banks to face a multimillion-dollar penalty from U.S. regulators over employees’ use of unapproved communication methods.
CIBC will pay US$30-million to the Commodity Futures Trading Commission and US$12-million to the Securities and Exchange Commission, the CFTC and SEC said Tuesday. In total, the SEC fined 11 firms more than US$88-million for widespread recordkeeping failures, with independent investment bank Canaccord Genuity being the other Canadian name on the list. Canaccord agreed to pay a US$1.25-million penalty.
“From at least Sept. 2018 to the present, CIBC failed to stop employees, including those at senior levels, from communicating using unapproved communication methods, including messages sent via personal text,” the CFTC said in a statement.“Throughout this process, CIBC offered its full co-operation to both regulators and took immediate remedies internally,” he said by e-mail.US$124.5-million and US$45-million respectively in combined penalties to the two regulators over similar violations.
Brokers, swaps dealers and investment advisers registered with the two U.S. agencies have requirements to keep detailed records of their communications and to turn them over for review upon request. Regulators have been cracking down on use of personal devices in recent years amid concerns that failure to keep records of personal communications makes oversight and enforcement more challenging.
The CFTC has imposed US$1.2-billion in civil monetary penalties on 24 financial institutions since 2021, the agency said.
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