The Canadian Imperial Bank of Commerce (CIBC) has been ordered to pay a $30 million civil monetary penalty by the Commodity Futures Trading Commission (CFTC), it was revealed on Tuesday.
The CFTC said the order settles charges with the CIBC for failing to maintain and preserve required records and for failing to diligently supervise its business as a CFTC registrant.
“The order imposes a $30 million civil monetary penalty; orders CIBC to cease and desist from further violations of recordkeeping and supervision requirements; and orders CIBC to engage in specific remedial undertakings,” said the CFTC.
The CFTC revealed it found the CIBC failed to stop employees, including those at senior levels, from communicating using unapproved communication methods, such as personal text messages.
The process violated the firm’s internal policies and procedures, which generally prohibited such communications.
The CFTC adds that the use of unapproved communication methods led to CIBC’s failure to maintain and preserve certain written communications related to its CFTC-registered business.
The CFTC noted that CIBC would not have been able to provide these communications promptly if and when requested.
The CFTC’s order also recognizes CIBC’s cooperation with the investigation. However, they believe the $30 million fine is a significant penalty and highlights the importance of compliance with recordkeeping and supervision requirements.
Since December 2021, the CFTC has imposed a total of $1.237 billion in civil monetary penalties on 27 financial institutions for their use of unapproved methods of communication.