- JPMorgan has agreed to pay a $125 million fine after the SEC found it violated federal laws.
- JPMorgan employees used personal email, text, and WhatsApp to discuss bank business, the SEC says.
- The SEC is now investigating other financial institutions as a result of the investigation.
JPMorgan Chase has agreed to pay a $125 million fine after allowing employees to discuss bank business on personal phones.
The Securities and Exchange Commission announced Friday that it found "widespread and longstanding failures" to preserve written communications among JPMorgan employees, who were using WhatsApp, email, and text to discuss securities business matters, a violation of federal law.
The regulator found that the practice took place between at least January 2018 and November 2020 and was prevalent throughout the firm.
"Indeed, supervisors, including managing directors and other senior supervisors … used their personal devices to communicate about the firm's securities business," the commission said in a statement regarding the charges.
Financial institutions are required by law to keep records of business communications between brokers and clients. The SEC discovered JPMorgan was violating that rule when one of the firm's brokers wasn't able to produce records during the investigation, Reuters' Katanga Johnson reported.
JPMorgan has admitted to the charges and, along with the fine, has agreed to hire a compliance consultant to review the firm's record-keeping policies, the SEC said.
A spokesperson for JPMorgan did not immediately respond to Insider's request for comment.
As a result of this investigation, the SEC has launched similar investigations at other financial firms, it said. An SEC official told Reuters that individuals and firms that self-report violations could face less serious penalties.