An investigation has been looking into some of Wall Street’s largest banks. Again. American regulators are addressing the banks’ use of unauthorized messaging apps and how they handle information passing through them. To counter this, the investigators have forced the banks to hire a ‘WhatsApp Cop’ to ensure these apps aren’t used again. On top of this, the eleven banks involved must pay fines that exceed $2 billion.
You’re under arrest – would you like to block this contact?
Amongst the offenders were Bank of America Corp., Morgan Stanley, and Goldman Sachs Group Inc. Each has been forced to hire a ‘compliance consultant’. This consultant’s role is to monitor the information passing through text platforms like WhatsApp. They must also keep an eye on how information is archived within the company; and whether it’s safe or not.
The banks were aware that using unauthorized messaging apps was wrong. The issue is; these messages are not encrypted, yet employees use the platform to store potentially sensitive information. This behaviour could lead to larger complications down the line, even if nothing specifically went wrong this time. Hence all the policing.
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“Finance, ultimately, depends on trust,” said SEC Chair Gary Gensler. “As technology changes, it’s even more important that registrants appropriately conduct their communications about business matters within only official channels, and they must maintain and preserve those communications.”
Along with the fines and WhatsApp Cops the banks have hired, Bank of America is making the effort to switch to Signal, which is encrypted. The bank has also told employees to delete old messages sent through any unauthorized apps used previously. Other banks have not yet done so, but we’re sure they will follow Bank of America’s lead as soon as possible.
Source: Bloomberg