In the latest round, nine investment advisers and three broker-dealers admitted violating record-keeping rules and vowed to improve compliance, the regulator said in a statement. Lapses involved personnel at multiple levels, including supervisors and senior managers, it said.
“When firms fall short of those obligations, the consequences go far beyond deficient document productions,” the SEC’s acting enforcement director, Sanjay Wadhwa, said in the statement. “Such failures implicate the transparency and the integrity of the markets and their participants, like the firms at issue here.”
Among the largest sanctions, three Blackstone affiliates agreed to pay a total of US$12 million, while a KKR unit pays US$11 million, a Schwab broker-dealer US$10 million and an Apollo subsidiary US$8.5 million.
Other entities sanctioned include affiliates of Carlyle Group, TPG and Banco Santander. PJT Partners will pay the smallest penalty of US$600,000, with the agency crediting the firm for self-reporting lapses.
“We have already taken significant steps to further strengthen our electronic communications procedures — including before the start of this inquiry — and are committed to the highest standard of compliance,” a spokesperson for Blackstone said in a statement.
“We are pleased to resolve this immaterial matter and remain focused on delivering exceptional service and an outstanding experience to our clients,” Schwab said in a statement.
The Santander affiliate, Santander US Capital Markets, said it is “fully committed to meeting our regulatory and compliance obligations. We have cooperated extensively with the SEC in their review of this matter and have made considerable enhancements to our policies and procedures.”
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Representatives for the other firms either declined to comment or didn’t immediately respond to messages.
The cases come just days before US President-elect Donald Trump’s administration takes charge. Paul Atkins, the former SEC commissioner nominated to run the regulator, has advised some of Wall Street’s most prominent firms. He’s expected to shift its enforcement focus if confirmed, potentially eschewing the Biden administration’s penalties for procedural foot faults.
