Venyu Blog

In this regulatory-sensitive environment where it seems nearly every bleat, IM or keystroke is subject to subpoena, the Financial Industry Regulatory Authority (FINRA) has announced it has fined Piper Jaffray & Company, an international middle market investment bank and institutional securities firm, $700,000 for its failure to retain 4.3 million emails from November 2002 through December 2008. 

In its press release, FINRA, the largest non-governmental regulator for all securities firms doing business in the United States, found Piper Jaffray also failed to inform the authority of its email retention and retrieval issues. FINRA found this lack of disclosure may have impacted the firm’s ability to comply with email extraction requests while potentially affecting its ability to respond fully to email requests from other regulators, or from parties in civil litigation or arbitrations.

This isn’t the first time Piper Jaffray has run up against email retention failures. In November 2002, in a joint action by the Securities and Exchange Commission, New York Stock Exchange and the National Association of Securities Dealers (NASD), Piper Jaffray was required to review its systems and certify it had established systems and procedures designed to preserve electronic mail communications.

In settling that matter, the firm neither admitted nor denied the charges, but consented to the entry of FINRA’s findings. Coupled with the new $700,000 fine that’s two strikes against it.

Interestingly enough, had Piper Jaffray only taken advantage of Venyu’s Mail Compliance solution which easily enables financial services companies to fulfill SEC and FINRA regulations through email archiving-as-a-service, it might never have come to the attention of FINRA regulators in the first place.