Wolters Kluwer has unveiled a compilation of penalties imposed by U.S. financial services regulators over the past several years, providing compliance officers strategic insights into the aggregate volumes and penalty amounts issued to financial services institutions in the United States. Covering a period from 2018 through 2023 reflected in half-year increments, the Regulatory Violations Intelligence Index examines key violation categories—competition-related offenses, consumer protection-related offenses and financial offenses—across federal and state regulatory bodies.
“In today’s rapidly evolving regulatory landscape, compliance executives increasingly depend on data-driven intelligence to help optimize their compliance risk management efforts,” says Vikram Savkar, Executive Vice President and General Manager for Wolters Kluwer Compliance Solutions. “Our Regulatory Violations Intelligence Index helps expand the peripheral vision of compliance leaders by analyzing the key supervisory priorities of the most important U.S. regulatory bodies.”
Key findings from the Index six-year review period
In terms of the volume of enforcement actions issued, the ranking of the three violation categories has remained consistent over the Index assessment period, with consumer protection-related regulations driving the highest number of penalties and competition-related regulations the lowest. Among the key findings:
- Enforcement actions for illegal fees and customer data security breaches have been consistent priorities for banking regulators.
- Policy issuance and claims handling issues were repeatedly cited by insurance regulators.
- Consumer protection-related violations have been predominant, reaching a peak of 123 enforcement actions in the first half of 2020 and, in the second half of 2022, resulting in approximately $4.1 billion in penalties issued.
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Additional findings
The second half of 2023 further reflects the magnitude of financial-related offense penalties in both the volume and amounts assessed:
- 46 violations totaling $11.3 billion, which represents a 130% increase in enforcement actions and a 2,739% increase in penalty value over the previous half-year levels.
- The U.S. Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission (CFTC) issued the highest number of actions, focusing heavily on investor protection violations and internal financial institution supervision failures.
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“With the Index, financial institutions will be able to gain access to vital data intelligence, empowering them to more effectively understand compliance risk factors and build data-informed compliance and regulatory change management programs to help enhance their overall compliance program effectiveness,” adds Savkar.
Wolters Kluwer will update the Index semi-annually to give compliance professionals a timely, holistic view of the evolving supervisory priorities of key regulators for banks, brokerage firms and insurance providers.
