Elizabeth Warren, the senior US senator from Massachusetts, sent letters to six regulators Monday highlighting her concerns around Symphony's message and chat archiving policies.
The letters — sent to the CFTC, SEC, DOJ, FDIC, CFPB and Finra — noted that steps Symphony has taken to prevent external authorities from "spying" on users' messages could also help them evade major enforcement actions, for which the archives would provide potentially crucial information.
"The communications that Symphony will allow companies to hide from ‘government spying' — such as text messages and chat room transcripts — have proven to be ‘key evidence' in many previous regulatory and compliance cases that have uncovered criminal action by Wall Street," Warren said. "If banks are now making this information more difficult for regulators to obtain and interpret, it could prevent these regulators from identifying and preventing future illegal behavior."
The New York State Department of Financial Services (NYSDFS) launched an investigation into the platform's workflow a few weeks ago, citing similar concerns.
Symphony, which is funded by a consortium including Goldman Sachs and a number of other banks and investment managers, is set to go live with some of its services next month.
"Symphony is designed to meet the cyber-security and compliance needs of financial firms and the use of Symphony does not change regulators’ ability to obtain messages from our clients," the company said in a statement. "Symphony delivers messages to its clients to download, decrypt, and archive, and they are able to provide those messages to regulators just as they would with other compliant messaging systems. Symphony is innovative because of its “end-to-end” security capability that protects communications from cyber-threats and the risk of a data breach—while safeguarding our customers' ability to retain records of their messages."
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