US hits record high for financial service penalties
15 January 2025 US
Image: stock.adobe.com/Daniel
The US Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission (CFTC) reported the highest levels of enforcement actions in 2024, as per SteelEye’s annual fine tracker.
The SEC filed 583 penalties worth US$2.1 billion and the CFTC announced it had imposed fines worth US$2.6 billion. Combined with monetary relief obtained via disgorgement and restitution, including the finalised settlement for the FTX scandal, the combined total of enforcement actions stands at US$25.3 billion.
Their UK counterparts, the Financial Conduct Authority (FCA), also saw a rise in enforcement actions in 2024. SteelEye note a 230 per cent increase as the FCA imposed £176 million worth of fines.
Matt Smith, CEO and co-founder of SteelEye, comments: “In many ways, 2024 was quite exceptional from a regulatory standpoint. Not only did US watchdogs report record-breaking enforcement actions, but their British counterpart shifted up a gear with regards doling out penalties — perhaps a sign of what’s to come in 2025 if the FCA’s instant messaging investigation intensifies.”
Elsewhere in Europe, France’s AMF saw a decline in financial penalties. The regulator issued fines of just €13.9 million, down from €127.9 million in 2023 — representing an 89 per cent decrease.
BaFin and FOJ in Germany saw the number of fines decrease, but values increase. In 2023, the regulators issued €8.1 million worth of fines but that figure rose to €24.6 million, despite a 12 per cent decrease in the number of fines.
On Europe, Smith adds: “There were also interesting surprises, with European regulators appearing to take their foot off the gas somewhat with regards to fine issuance. But rather than suggest a change of regulatory focus, this may be evidence that European firms have implemented more sophisticated compliance systems over recent years.”
Singapore’s MAS handed out five fines worth a total S$7.7 million in 2024 — equal to the value issued in 2023.
The Australian Securities and Investment Commission (ASIC), handed out 20 financial penalties in the first half of 2024, worth a total AU$32.2 million. The statistics for the latter half of the year are yet to be released.
Smith adds: “Looking ahead, the question many firms will be pondering — particularly those with global operations — is whether Trump’s election victory will see US regulators take a more relaxed approach to enforcing issues like off-channel communications.
“While the intensity of enforcement action may subside in the US in 2025, we don’t expect firms will reverse any of the initiatives already put in motion. In fact, we are more likely to see increased investment on a global basis in monitoring tools to address growing risks from overlooked platforms.”
The SEC filed 583 penalties worth US$2.1 billion and the CFTC announced it had imposed fines worth US$2.6 billion. Combined with monetary relief obtained via disgorgement and restitution, including the finalised settlement for the FTX scandal, the combined total of enforcement actions stands at US$25.3 billion.
Their UK counterparts, the Financial Conduct Authority (FCA), also saw a rise in enforcement actions in 2024. SteelEye note a 230 per cent increase as the FCA imposed £176 million worth of fines.
Matt Smith, CEO and co-founder of SteelEye, comments: “In many ways, 2024 was quite exceptional from a regulatory standpoint. Not only did US watchdogs report record-breaking enforcement actions, but their British counterpart shifted up a gear with regards doling out penalties — perhaps a sign of what’s to come in 2025 if the FCA’s instant messaging investigation intensifies.”
Elsewhere in Europe, France’s AMF saw a decline in financial penalties. The regulator issued fines of just €13.9 million, down from €127.9 million in 2023 — representing an 89 per cent decrease.
BaFin and FOJ in Germany saw the number of fines decrease, but values increase. In 2023, the regulators issued €8.1 million worth of fines but that figure rose to €24.6 million, despite a 12 per cent decrease in the number of fines.
On Europe, Smith adds: “There were also interesting surprises, with European regulators appearing to take their foot off the gas somewhat with regards to fine issuance. But rather than suggest a change of regulatory focus, this may be evidence that European firms have implemented more sophisticated compliance systems over recent years.”
Singapore’s MAS handed out five fines worth a total S$7.7 million in 2024 — equal to the value issued in 2023.
The Australian Securities and Investment Commission (ASIC), handed out 20 financial penalties in the first half of 2024, worth a total AU$32.2 million. The statistics for the latter half of the year are yet to be released.
Smith adds: “Looking ahead, the question many firms will be pondering — particularly those with global operations — is whether Trump’s election victory will see US regulators take a more relaxed approach to enforcing issues like off-channel communications.
“While the intensity of enforcement action may subside in the US in 2025, we don’t expect firms will reverse any of the initiatives already put in motion. In fact, we are more likely to see increased investment on a global basis in monitoring tools to address growing risks from overlooked platforms.”
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