The U.S. Securities and Exchange Commission (“SEC”) is nearing settlements with around two dozen Wall Street firms, including Truist Financial Corp (TFC Quick QuoteTFC - Free Report) , U.S. Bancorp (USB Quick QuoteUSB - Free Report) and Fifth Third Bancorp (FITB Quick QuoteFITB - Free Report) , to resolve probes related to record-keeping lapses and use of unauthorized messaging tools. This was first reported by Reuters that cited people with knowledge of the matter.

Since companies are required to keep a record of all business communications but are unable to keep a close tab on off-channel communication, using them to discuss business is a breach.

Under the deals being finalized with the SEC, the firms, including TFC, USB and FITB, are likely to pay fines and admit wrongdoing. Firms are also expected to make changes to fix the lapses, including hiring independent consultants to revamp record-keeping programs.

The ongoing two-year investigation initially focused on broker-dealers and investment advisers who were fined more than $2 billion in total for using WhatsApp and other unapproved messaging apps. Per sources, the new settlements might see firms paying a total of $50 million in fines.

The SEC is expected to announce a few settlements in a group ahead of its fiscal year-end on Sep 30.

Previously, the regulator negotiated two other large group settlements as part of the probe by bringing 30 related enforcement actions.

Notably, 16 broker-dealers and investment advisers, including TCF, USB and FITB, have acknowledged in regulatory filings that the SEC is probing their communications.

Fifth Third does not expect any material impact on its financials related to the settlement negotiations.

Deficiencies in Wall Street's record-keeping problem came to light when JPMorgan Chase failed to provide documents from at least 2018 related to an unrelated probe. According to a 2021 settlement, the bank agreed to pay $125 million to the SEC to resolve charges over record-keeping lapses.