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Morgan Stanley commodities bankers leave for WhatsApp breach

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The Morgan Stanley logo is displayed at the post where it is traded on the floor of the New York Stock Exchange (NYSE) in New York, U.S., April 19, 2017. REUTERS/Brendan McDermid
The Morgan Stanley logo is displayed at the post where it is traded on the floor of the New York Stock Exchange, 19 April 2017. (PHOTO: REUTERS/Brendan McDermid)

By Jack Farchy and Javier Blas

(Bloomberg) -- The two most senior commodities executives at Morgan Stanley are leaving after compliance breaches linked to the use of communications tools such as WhatsApp, according to two people familiar with the matter.

Nancy King, global head of commodities, and Jay Rubenstein, head of commodities trading, are leaving, the people said, asking not to be named discussing internal matters. Morgan Stanley declined to comment.

The bank is one of the biggest commodities dealers on Wall Street alongside Goldman Sachs Group Inc., JPMorgan Chase & Co. and Citigroup Inc.

The veteran executives’ departures come after the bank discovered the use of unauthorised electronic means of communication, including the use of the WhatsApp messaging app. It didn’t find any wrongdoing, but the use of those communication channels went against policy, the people said.

Wall Street banks have clamped down on the use of WhatsApp and other instant messaging platforms in recent months. Messages on the WhatsApp service are encrypted from start to finish, and can’t easily be monitored by compliance departments.

JPMorgan earlier this year punished more than a dozen traders for using WhatsApp at work, firing one and cutting bonus payments for the rest.

King and Rubenstein didn’t immediately respond to messages seeking comment.

King joined Morgan Stanley 34 years ago, trading oil and rising through the commodities division to become the most senior woman in the business on Wall Street. Rubenstein, who many considered her likely successor, joined in 2007 to trade power and later became head of power and gas, according to their LinkedIn profiles.

SparkSpread first reported the departures.

© 2020 Bloomberg L.P.