SEC and CFTC Continue Targeting Off-Channel Communications at Financial Institutions

10 August 2023
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Key Takeaways:
  • On August 8, the SEC and CFTC announced another round of recordkeeping settlements against broker-dealers and one investment adviser regarding off-channel communications.
  • In this update, we discuss how these settlements reflect: (1) regulators’ continued imposition of significant penalties for these violations; (2) an emphasis on the importance of self-reporting and cooperation; and (3) a universal requirement for independent compliance consultants. We also highlight best practices that firms can implement to strengthen their policy frameworks governing electronic communications.