GUEST ESSAY: JPMorgan’s $200 million in fines stems from all-too-common compliance failures

By Dima Gutzeit

Last month’s $125 million Security and Exchange Commission (SEC) fine combined with the $75 million U.S. Commodity Futures Trading Commission (CFTC) fine against JPMorgan sent shockwaves through financial and other regulated customer-facing industries.

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According to a SEC release, hefty fines brought against JPMorgan, and its subsidiaries were based on “widespread and longstanding failures by the firm and its employees to maintain and preserve written communications”. These views were echoed in a CFTC release as well.

While the price tag of these violations was shocking, the compliance failure was not. The ever-changing landscape of rapid communication via instant messaging apps, such as WhatsApp, Signal, WeChat, Telegram, and others, has left regulated industries to find a balance between compliance and efficient client communication.

Insecure platforms

Approved forms of communication such as phone calls, emails, and fax are viewed by some consumers as obsolete. So, as teams work to remain relevant, team leaders and employees carry the burden of ensuring a better and more intuitive customer experience.

Many of these instant messaging platforms are secure, even offering end-to-end encryption, so the lack of security is not necessarily in the apps themselves. Without a responsible business communication platform for these conversations to flow through, customer requests and discussions live only on employees’ personal devices.


Besides going against regulatory requirements, it also means that if an employee leaves the company, customer data goes with them. With over 5 billion monthly users on these chat platforms, allowing employees to use these streamlined communication channels with no oversight poses a double-pronged challenge for companies.

Seeking relevancy

The first is, how do they monitor these conversations to ensure optimal customer experience? Second, how can they promote efficient communication using the customer’s preferred channel while remaining compliant with local regulations?

It’s no secret that companies are aware of what they are missing. By not being allowed to use common chat platforms, which enhance the customer experience, organizations have a hard time appearing relevant to their clientele.

The current status is to force clients to use traditional communication methods while banning instant messaging apps.  A more practical solution would be to use an enterprise-approved chat application that allows employees of regulated industries to chat via customer-preferred apps while archiving all chat data on company servers. The latter comply with record-keeping regulations since the chat is occurring through a mobile application or desktop that requires all data to flow through a company cloud or on-premise server.

At LeapXpert, we found that relying on native official APIs and SDKs allows for optimal conversation data capture on the backend while appearing on the front end as a sleek modern interface for employees which can also be integrated with enterprise collaboration tools, such as Microsoft Teams or Slack.

Employees don’t have to use their personal WhatsApp or WeChat for conducting business conversations. This solves the problem of properly managing client data while also allowing the company to gain a better understanding of how today’s customers want to communicate with their financial, legal, or medical professionals.

About the essayist: Dima Gutzeit With 20 years is the founder of LeapXpert, a business communications platform that allows regulated industries to better connect with their clientele. Prior to LeapXpert in 2017, Dima created a large CPaaS platform, built customer communications platforms, and was the CTO of a large multinational communication provider.

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