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To the surprise of no one, Matt Levine has written about this a few times (there's some other linked issues in here as well): https://www.bloomberg.com/opinion

To the surprise of no one, Matt Levine has written about this a few times (there's some other linked issues in here as well): https://www.bloomberg.com/opinion/articles/2023-08-08/don-t-do-deals-on-linkedin https://www.bloomberg.com/opinion/articles/2023-08-08/don-t-... His is a pretty balanced take and raises some interesting points: > I have argued that the SEC has aggressively expanded the recordkeeping requirements. In the olden days, almost all communication was informal and not recorded, and only formal decisions were memorialized in typed and carbon-papered memos, so the SEC had access only to a pretty limited slice of communications. Now, vastly more informal communication is text-based, and texting is a substitute for conversation, not for formal memos. The rest of the piece and some of his related commentary in the area is worth a read.

mvdtnz 3y ago
I don't see a downside to expanding the record keeping requirements. Record keeping is easier than ever and frankly banks haven't proven themselves worthy of our trust. Sounds great to me.
- lotsofpulp 3y ago
  I assume being able to have face to face off the record conversations providing plausible deniability to participants is one of the big reasons finance and other related businesses like to be in Manhattan.
  - Terr_ 3y ago
    Perhaps also a factor in why some managers prefer to manage employees in-person rather than remotely. When it comes to avoiding the record, it doesn't have to be lofty corrupt/ish deals or schemes, but also cases like certain anti-union threats, or even plain personal power-tripping.
    - red-iron-pine 3y ago
      definitely a factor. e.g. the C-level one-liner email that consists of "lets have a chat about this" doesn't even have to be anything malicious, such as not wanting to socialize an idea until it's fully-baked or hiring for a new VP role
- BaseballPhysics 3y ago
  I don't think I disagree and I don't think Matt does either. The point is that from a bank employee perspective, a hallway conversation, a text message, and a WhatsApp chat might seem pretty similar, and no one expected face to face chats to be memorialized in preserved records, so why the other two? So in a meaningful sense, the requirements around preservation have expanded significantly, and it shouldn't be a surprise that a lot of banks ended up breaking the rules. As he writes in another piece (https://news.bloomberglaw.com/mergers-and-acquisitions/matt-levines-money-stuff-the-deli-was-allegedly-a-fraud https://news.bloomberglaw.com/mergers-and-acquisitions/matt-...): > My point here is that when these rules were written, it would have been absurd to say that brokers had to “appropriately conduct their communications about business matters within only official channels.” Everyone understood, in 1948, that only a small sliver of business was conducted in formal letters and memoranda, and that mostly you’d talk about business face-to-face. “As technology changes,” lots of forms of written electronic communication become substitutes not for memoranda, but for face-to-face conversation. So the SEC’s requirements constantly become broader. If you just talk to your colleagues in person, the SEC does not expect you to preserve that. Once you move that chat to WhatsApp, it does. Now the SEC has run around fining a bunch of institutions and sent a message, and so you can expect compliance will improve. As an aside, you'll notice that piece was written nearly a year ago, so this isn't exactly a new story.
  - dghlsakjg 3y ago
    There’s a reason that lawyers and criminals prefer phone calls. If you make records, you’re gonna have to produce them when investigated. To quote Stringer Bell from The Wire: “Is you taking notes on a criminal fucking conspiracy?”

mvdtnz 3y ago

I don't see a downside to expanding the record keeping requirements. Record keeping is easier than ever and frankly banks haven't proven themselves worthy of our trust. Sounds great to me.

lotsofpulp 3y ago
I assume being able to have face to face off the record conversations providing plausible deniability to participants is one of the big reasons finance and other related businesses like to be in Manhattan.
- Terr_ 3y ago
  Perhaps also a factor in why some managers prefer to manage employees in-person rather than remotely. When it comes to avoiding the record, it doesn't have to be lofty corrupt/ish deals or schemes, but also cases like certain anti-union threats, or even plain personal power-tripping.
  - red-iron-pine 3y ago
    definitely a factor. e.g. the C-level one-liner email that consists of "lets have a chat about this" doesn't even have to be anything malicious, such as not wanting to socialize an idea until it's fully-baked or hiring for a new VP role
BaseballPhysics 3y ago
I don't think I disagree and I don't think Matt does either. The point is that from a bank employee perspective, a hallway conversation, a text message, and a WhatsApp chat might seem pretty similar, and no one expected face to face chats to be memorialized in preserved records, so why the other two? So in a meaningful sense, the requirements around preservation have expanded significantly, and it shouldn't be a surprise that a lot of banks ended up breaking the rules. As he writes in another piece (https://news.bloomberglaw.com/mergers-and-acquisitions/matt-levines-money-stuff-the-deli-was-allegedly-a-fraud https://news.bloomberglaw.com/mergers-and-acquisitions/matt-...): > My point here is that when these rules were written, it would have been absurd to say that brokers had to “appropriately conduct their communications about business matters within only official channels.” Everyone understood, in 1948, that only a small sliver of business was conducted in formal letters and memoranda, and that mostly you’d talk about business face-to-face. “As technology changes,” lots of forms of written electronic communication become substitutes not for memoranda, but for face-to-face conversation. So the SEC’s requirements constantly become broader. If you just talk to your colleagues in person, the SEC does not expect you to preserve that. Once you move that chat to WhatsApp, it does. Now the SEC has run around fining a bunch of institutions and sent a message, and so you can expect compliance will improve. As an aside, you'll notice that piece was written nearly a year ago, so this isn't exactly a new story.
- dghlsakjg 3y ago
  There’s a reason that lawyers and criminals prefer phone calls. If you make records, you’re gonna have to produce them when investigated. To quote Stringer Bell from The Wire: “Is you taking notes on a criminal fucking conspiracy?”