Global banks, including HSBC, are implementing restrictions on employee communication in response to increased regulatory scrutiny. HSBC has banned staff from texting on their work phones, following fines issued to brokerage and investment firms over their use of messaging apps like WhatsApp. Banks and financial institutions face compliance rules for storing and using employees’ texts and other communications, with instant messaging apps seen as more problematic as they connect to personal devices, making monitoring difficult. The move by banks to restrict communication is seen as a proactive measure to prevent further fines and missteps.
The crackdown on communication follows the ongoing efforts of regulators to address failures in maintaining and preserving electronic communications on personal devices. The SEC specifically highlighted violations by firms in using messaging platforms such as WhatsApp, iMessage, and Signal on personal devices, with failures in record-keeping seen to undermine regulatory oversight. Future enforcement actions are expected as violations by other firms have already been identified. Several major financial institutions, including Bank of America, Wells Fargo, and Citigroup, have paid over $2.5 billion in penalties for recordkeeping violations since last year.
In separate news, Tesla reported a drop in third-quarter earnings, falling short of Wall Street expectations. Adjusted earnings for the quarter were $2.3 billion, down 37% from the previous year. The company also missed revenue predictions, reporting $23.4 billion compared to the forecasted $24.1 billion. Tesla has been lowering vehicle prices to counter competition from other electric vehicle manufacturers. Analysts are now questioning when the price cuts will end and how they are impacting margins. Tesla’s CEO, Elon Musk, cited higher interest rates and global conflicts as affecting consumer demand for cars.
Furthermore, Costco’s longtime CEO, Craig Jelinek, will step down at the end of the year. The current president and chief operating officer, Ron Vachris, will replace him. During Jelinek’s tenure, Costco’s stock has experienced significant growth. The company has not raised membership fees since 2017, unlike competitors Amazon and Sam’s Club. However, it has hinted at the possibility of a future increase. Costco is the third-largest retailer in the US, with 861 warehouses worldwide.