Four major banks agree to keep data available for regulators
New York - AFP
Four major banks agreed Monday to keep data available for regulators when they use Symphony, their new secure chat and messaging platform, US authorities said.
The move comes in response to concerns raised by the New York state financial regulator that Symphony's features, including "guaranteed data deletion", could hinder investigations on Wall Street.
Recent scandals rocking the financial sector, including the rigging of the Libor interest rate and the foreign exchange market, revealed conspirators used chat rooms and instant messaging to coordinate their illegal moves.
Four members of the consortium that created Symphony agreed to the new data protections: US banks Goldman Sachs and Bank of New York Mellon; Deutsche Bank, Germany's biggest bank; and Swiss giant Credit Suisse, said the New York State Department of Financial Services (NYDFS).
Under the terms of the agreements, Symphony will keep all e-communications to and from the four banks for seven years, and the four banks will store duplicate copies of decryption keys with independent custodians.
"We are pleased that these banks did the right thing by working cooperatively with us to help address our concerns about this new messaging platform," said Anthony Albanese, acting chief of the NYDFS.
"This is a critical issue since chats and other electronic records have provided key evidence in investigations of wrongdoing on Wall Street. It is vital that regulators act to ensure that these records do not fall into a digital black hole."
The four banks are the only ones within the consortium that the NYDFS regulates, but it said it believes the new agreement should apply to all those using Symphony.
Fourteen major banks and financial institutions launched Symphony Communications in October 2014. The others include JPMorgan Chase, Citigroup, Morgan Stanley, BlackRock and Nomura.
The upstart Symphony, a challenger to market leader Bloomberg, insists that its cloud-based platform does not hinder regulatory oversight.
"Symphony does not make it harder for government regulators to obtain chats from the firms they regulate. In fact, Symphony is designed to ensure that firms receive their chats and can retain them in full compliance with record retention rules," it said last month.