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ARTICLE · 16 AUGUST 2024

The SEC Is Not Done Bringing Enforcement Actions For Off-Channel Communications

K&L Gates
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Following a number of eyebrow-raising settlements with broker-dealers and dual registrants and a standalone investment adviser, on 14 August 2024 the SEC settled charges against 26 broker-dealers...

United StatesStrategy

Following a number of eyebrow-raising settlements with broker-dealers and dual registrants and a standalone investment adviser, on 14 August 2024 the SEC settled charges against 26 broker-dealers, investment advisers, and dual registrants for recordkeeping failures related to off-channel communications. The combined monetary penalties totaled nearly US$393 million, with individual penalties ranging from US$400,000 to US$50 million. The SEC noted that three of the firms (which paid US$5.5 million, US$4.5 million, and US$1.6 million penalties) self-reported their violations and consequently paid "significantly less" than they otherwise would have.

Some key takeaways from these settlements:

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