Washington, D.C. – Goldman Sachs & Co. LLC has been slapped with a $1 million penalty by the Commodity Futures Trading Commission (CFTC) for failing to properly maintain audio recordings as required for swap dealers, according to an order filed today.
The CFTC alleges that between March 2013 and January 2014, a software patch caused recording hardware in one of Goldman’s offices to malfunction, resulting in a three-week period where phone conversations from trading and sales desks were not captured. Goldman remained unaware of the issue until a routine check revealed the failure.
The lapse in recordkeeping directly hindered an unrelated investigation by the CFTC’s Division of Enforcement. When the Division requested audio recordings from the affected office, Goldman was unable to provide a significant number of files, admitting the recording system had been down. The CFTC stated the missing recordings contained information unattainable through other means, impeding the ongoing investigation.
“Registrants must comply with the Commission’s recordkeeping requirements, as with all other applicable laws,” stated CFTC Enforcement Director James McDonald. “When they do not, we are committed to holding them accountable. This action reinforces the critical importance of recordkeeping requirements to the CFTC’s enforcement mission.”
As part of the settlement, Goldman Sachs is required to pay the $1 million civil monetary penalty and cease any further violations of CFTC regulations. The investigation was led by CFTC staff members Gabriella Geanuleas, Brandon Wozniak, Christopher Giglio, Kathryn Sandstrom, David W. MacGregor, Lenel Hickson, Jr., and Manal M. Sultan.
Source: CFTC.gov
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