SEC expands WhatsApp probe, gathers private messages from Wall Street: Report

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Reuters reported citing sources. Earlier, the Securities and Exchange Commission (SEC) had requested these companies to conduct internal reviews of messages as part of its inquiry into Wall Street's use of unauthorized messaging apps like WhatsApp and Signal for work-related discussions.

The ongoing two-year investigation aimed at identifying potential violations of record-keeping regulations initially focused on broker-dealers, resulting in regulators imposing fines totaling over $2 billion. Also Read: The SEC Wants To Spy On Your Portfolio While Reuters and various other news outlets have covered the expansion of the SEC's investigation into "off-channel" communications to include investment advisers, the detailed examination of thousands of their staff messages had not been previously disclosed.

"It increases risk," one source said. "The more information you give the SEC, the more you fuel the beast." In the most recent stage of the investigation involving over a dozen investment advisers, the SEC has, in recent months, sought messages from personal devices or apps used during the first half of 2021 for conversations related to business, as reported by insiders.

The SEC's focus has extended to specific employees, including senior executives, with some cases involving as many as a dozen individuals. The firms include Carlyle Group, Apollo Global Management, KKR & Co, TPG, and Blackstone, according to three people with direct knowledge of the matter, as well as some hedge funds, including Citadel, a source told Reuters.