Wall Street Uses Snapchat, Too

Is instant messaging too much to handle for investment bankers? The world’s largest banks are beginning to think so, and the likes of Citigroup and Barclays, among others, are now considering disabling chat features because of irresponsible behavior.

Sometimes, the only motivating factor necessary is convenience. On Wall Street, that can mean cheating your client or even your wife.

With traditional time-wasting outlets like Gmail and Facebook blocked, traders on the Street have come to rely on their Bloomberg terminals—special computers costing thousands of dollars a month that provide instantaneous news, market data, and notably, a chat feature—for intra-workday relief.

After all, investment bankers are human, too. As such, simply having easy access to instant messaging can quickly devolve into irresistible NSFW behavior and insider trading, even when the perpetrators know that bosses and regulators alike might be watching. As per banking regulations, all communications are recorded.

“My friend’s boss discovered very graphic sexting between an FX sales girl and a guy on the Russian sales team,” a derivatives salesperson at a British bank told Buzzfeed. “There were details from positions they did the night before, their favorite things to do to each other, their weekend escapes. The girl was engaged and the guy was married at the time.”

And like humans everywhere, those on Wall Street are SnapChatting their dicks on the regular, as an investment banking friend told me, citing personal experience. The popular mobile app, which recently turned down a $3 billion offer from Facebook, is widely used in the world of finance, where disposability equates to discretion.

If the occasional scandalous sext between adulterous lovers might seem harmless in the grand scheme of things, it’s the potential for regulatory probes has already maligned banks hot and bothered. Naturally, there are rampant rumors that the platform is used to share tips. Those I spoke to are adamant it happens, though they haven’t experienced it firsthand. Where this sort of illegal activity definitely occurs is on Bloomberg terminals.

Regulators from Hong Kong to Switzerland to the UK are starting to clamp down on market manipulation, insider trading, and other illegal activities. In the US, banks were typically only fined for violating the rules without technically being guilty, but the Securities and Exchange Commission is now pursuing admissions of wrongdoing along with settlements. JP Morgan, one of the banks considering shutting down its chat rooms, agreed to pay the SEC $200 million in September after admitting to fraud.

While bad behavior on Wall Street is expected, it’s usually the sheer brazenness of their efforts that can still surprise. UK regulators investigating the LIBOR scandal, which Rolling Stone writer Matt Taibbi has called the biggest scam in history, discovered a Bloomberg chat room called “The Cartel,” according to a report by the Wall Street Journal. There, members exchanged jokes about the ease of manipulating currency rates and “inappropriately shared information with competitors.”

Of course, the chat rooms are meant to be used for business, and they are, for the most part. To make deals and trades, market participants need to communicate with each other. But what happens when merely communicating results in inevitable wrongdoing?

In fact, it might not be the simple act of communication that’s the problem but rather the context of that communication. In other words, it's the culture of chat rooms that's dangerous.

“People treat instant messages more casually,” a prop trader told me, citing lengthy conversations about the topic on the trading floor. “Therefore, there’s more risk.”

Despite my friend’s conviction, it isn’t a stretch to imagine that the same issues could occur with email, if banks follow through with banning chats. Where there’s a will, there’s always a way, especially when there’s money and sex involved.

@sfnuop