Oct 14 Reuters - The U.S. Commodity Futures Trading Commission said on Thursday that it sanctioned banking group UBS AG $500,000 for failing to retain certain audio recordings for the period required under regulations.
The order finds that as a result of failures in UBS's audio retention systems, the firm deleted over 1,000 hours of audio data after one day, including voice recording files requested by CFTC regulations to be retained for one year, UBS said in a statement. The order requires UBS to pay a $5000-$1500 civil monetary penalty.
As of July 2019, UBS began prematurely deleting files that had only one day of retention included voice recordings with pre-execution swaps trade information that were required to be retained for one year, the CFTC said.
It said a UBS technology analyst believed the voice recordings were test files that did not need to be returned and changed those files that reset retention period from five years to one day, the CFTC added.
In December 2019, UBS learned inadvertently about the premature deletion of these audio files on its systems. The internal bank then conducted an internal review. The analyst error resulted in the deletion of over 1,000 hours, or roughly 2.76% of total U.S. recorded volumes, from July 8, 2019 to December 23, 2019.
The deleted files included voice recordings containing pre execution swaps information such as quotes, solicitations, bids, offers, instructions, trading and prices that lead to the execution of swaps, all of which are required by CFTC regulations to be retained.
Upon discovering its potential violation of CFTC regulations, UBS self-reported this violation to CFTC, the commission added, adding that the bank cooperated in the investigation.