tl;dr
Twelve financial firms, including Blackstone (BX), KKR (KKR), Charles Schwab (SCHW), and Apollo Capital Management (APO), have agreed to pay a total of $63M to settle a Securities and Exchange Commission investigation into recordkeeping failures. The firms admitted to not maintaining and preserving ...
Financial Giants Fined $63M for Recordkeeping Failures: SEC Investigation Reveals Shocking Details!
Twelve financial firms, including Blackstone (NYSE:BX), KKR (NYSE:KKR), Charles Schwab (NYSE:SCHW), and Apollo Capital Management (NYSE:APO), have agreed to pay a total of $63M to settle a Securities and Exchange Commission investigation into recordkeeping failures, the SEC announced on Monday. The firms admitted facts in their respective SEC orders and acknowledged that their staff failed to maintain and preserve electronic communications, violating recordkeeping provisions of federal securities laws, according to the agency.
The settlement is the latest in agreements reached with financial firms accused of failing to keep records of their employees' business communications via messaging platforms such as Whatsapp on personal devices.
The companies and penalties involved in this tranche are as follows:
- Blackstone (NYSE:BX) Alternative Credit Advisors LP, together with Blackstone Management Partners L.L.C. and Blackstone Real Estate Advisors L.P., agreed to pay a combined $12M penalty.
- Kohlberg Kravis Roberts & Co. L.P. (NYSE:KKR) agreed to pay $11M.
- Charles Schwab & Co. (NYSE:SCHW) Inc. agreed to pay a $10M penalty.
- Apollo Capital Management L.P. (NYSE:APO) agreed to pay $8.5M.
- Carlyle Investment Management L.L.C (NASDAQ:CG), together with Carlyle Global Credit Investment Management L.L.C., and AlpInvest Partners B.V., agreed to pay a combined $8.5M.
- TPG Capital Advisors LLC (NASDAQ:TPG) will pay $8.5M.
- Santander US Capital Markets LLC (NYSE:SAN) will pay $4M.
- PJT Partners LP (NYSE:PJT), which self-reported, agreed to pay a $600,000 penalty.
It's important for financial firms to adhere to recordkeeping regulations to ensure transparency and compliance with federal securities laws. Failure to do so can result in costly penalties and damage to the firm's reputation.
Ensuring proper recordkeeping practices can also help firms in conducting internal investigations, responding to regulatory inquiries, and protecting against potential litigation risks.
It's essential for financial firms to invest in robust recordkeeping systems and provide training to employees on the importance of compliance with recordkeeping regulations.
By taking proactive measures to strengthen recordkeeping processes, financial firms can avoid regulatory scrutiny and maintain trust with their clients and investors.
This settlement serves as a reminder to the financial industry of the consequences of failing to uphold recordkeeping requirements and the importance of prioritizing regulatory compliance.