Goldman Sachs fined $1m for not recording traders’ calls in 2014
Goldman Sachs has been hit with a $1 million fine by the US Commodity Futures Trading Commission (CFTC) after it was revealed the multinational investment bank was not recording its traders’ phone calls.
In a press statement released by the CFTC, the bank is exposed for failing to record calls in January 2014 for three weeks after installing a software security patch in one of its offices.
The recording hardware in that office “restarted prematurely” and failed to record audio. Goldman “was unaware of the error” until it conducted an unrelated spot-check of the office’s recording system three weeks later, at which point the bank realised the failure and turned its recording system back on.
When a division of the CFTC opened a separate investigation into the bank, it found Goldman “was unable to produce a significant number of the requested recordings” from this three week period.
The CFTC says it only learnt of Goldman’s failure because of the bank’s inability to support the unrelated investigation.
Enforcement director at the independent government agency James McDonald says the fine “reinforces the critical importance of recordkeeping requirements to the CFTC’s enforcement mission”.