Secure and compliant communication in businesses is critical for avoiding fines like Santander’s €4 million penalty. This highlights the importance of regulatory compliance. Though entities claim improvement, it begs the question: are our communications secure and monitored?

The SEC, the U.S. agency regulating financial markets, protects investors, ensures market efficiency, and enforces transparency laws. It oversees stock exchanges, participating entities, and public companies. Recently, it fined companies for misusing apps like WhatsApp, violating rules requiring commercial communications to be recorded and auditable.

The Securities Exchange Act of 1934 regulated U.S. financial markets and mandated record-keeping for business communications like emails and calls to ensure transparency and prevent fraud.

The SEC relies on these records to monitor transactions and maintain fair markets. Using unregulated channels hinders oversight, creating legal and financial risks for institutions and individuals involved in unrecorded transactions.

As communication platforms like WhatsApp and Signal have evolved, employees can now easily share information outside an organization’s recording systems. Despite banks’ strict communication tracking mechanisms, many employees use informal tools for professional purposes, bypassing rules requiring proper transaction records.

In late 2024, the SEC investigated Santander’s investment bankers for using personal devices and messaging apps for financial transactions, raising concerns about sensitive information control and leading to a fine.

Understanding why employees turn to such apps can help identify the problem and potential solutions.

Instant messaging applications allow for quick and direct communication, which is essential in the fast-paced financial environment. This gives bankers a more streamlined way to interact with colleagues or clients without having to go through the more formal, official channels. Unlike emails or follow-up phone calls, which tend to lengthen processes and cause delays, messaging applications provide instant access to make quick decisions.

Many people believe that tools such as WhatsApp, which have end-to-end encryption, offer a higher level of privacy than institutional platforms. This sense of security leads them to feel confident in using these tools to discuss sensitive topics, even if this may be against regulations. The expectation that their conversations will be ‘safe’ means that they do not consider the legal or compliance implications.

In markets where decisions need to be made quickly and flexibility is often required, more informal communication can be seen as a way of streamlining processes and avoiding unnecessary bureaucracy. This more fluid and relaxed approach is used to facilitate decision-making rather than waiting for formal approvals or official system checks.

Especially for businesses handling sensitive information, like financial services, an omni-channel system like FROGED is crucial. It not only provides tools like WhatsApp, but also ensures compliance with security and data protection regulations.

It’s vital that all communications, whether via WhatsApp, email, chat or other channels, are subject to strict security regulations. The General Data Protection Regulation (GDPR) and other relevant regulations, such as ISO/IEC 27001, ensure that organizations can handle communications securely, protecting confidentiality without compromising transparency and access to data where necessary.

A complete record of interactions ensures that transactions and messages can be audited in accordance with regulatory requirements. Compliance ensures that organizations have a clear and verifiable trail of their communications, which is vital in the event of an audit or regulatory investigation.

While applications such as WhatsApp offer end-to-end encryption, FROGED ensures privacy and security from start to finish. This helps maintain the confidentiality of conversations without losing control or traceability of business interactions.

Organizations can continue to benefit from the speed and flexibility of messaging applications such as WhatsApp without compromising compliance. The key is to integrate these channels into systems that ensure the traceability of information, avoiding the risk of non-compliance with communications regulations in regulated markets.

Therefore, secure and compliant communication in finance is crucial in 2025. While tools like WhatsApp offer speed and flexibility, integrating them into systems that ensure traceability is key to avoiding non-compliance. Indeed, recent fines highlight the serious consequences of mishandling communications:

• Blackstone: $12 million
• Kohlberg Kravis Roberts & Co: $11 million
• Charles Schwab & Co: $10 million
• Apollo Capital Management: $8.5 million
• Carlyle Investment Management: $8.5 million
• TPG Capital Advisors: $8.5 million
• Santander: $4 million
• PJT Partners: $600,000

Ultimately, companies must prioritize secure communication solutions, like FROGED, to streamline interactions while maintaining compliance and safeguarding sensitive information.

The message from these sanctions is clear: compliance is non-negotiable. And the solution is available to all companies that choose to act responsibly.