Recent regulations, including MiFID II, have introduced highly prescriptive rules about the recording, storage and access requirements of voice and electronic communications relating to financial dealings. With all relevant telephone conversations and electronic communications now required to be recorded – including those which take place on mobile phones – surveillance technology is not only a priority but a necessity.
For email and landline communications, the situation (and the solution) is relatively straightforward. But the sophisticated – and often encrypted – world of mobile communications presents a major challenge, and one that needs to be urgently addressed.
Institutions that fail to properly monitor mobile communications face severe consequences, and as a result, firms are taking no prisoners when it comes to compliance. Last week, JP Morgan suspended a senior credit trader in New York, for using Whatsapp to communicate with colleagues. In August last year, KPMG’s head of financial services in the UK was dismissed in a Whatsapp row. And in September, the FCA brought its first ever prosecution for the destruction of documents under the Financial Services and Markets Act 2000 against Konstantin Vishnyak, formerly of VTB Capital, for obstructing an insider dealing investigation by deleting Whatsapp messages.
But many firms have struggled with how to monitor and capture the wealth of communications channels used on mobiles and how to manage the behaviours often used on these devices. These challenges are magnified when firms use a BYOD (‘bring your own device’) policy – with the FCA, among other regulators, increasingly investigating the relating risks. Many banks have taken the easy route of a blanket ban on mobile devices on the trading floor – but, as we saw with Edward Koo at JP Morgan last week, this doesn’t solve the problem of external communications, while in terms of customer service, many clients expect a level of responsiveness that can only be achieved with mobile devices. So how can firms effectively and compliantly monitor and capture mobile communications?
Data analytics and compliance specialist SteelEye believes it has the answer. The firm has teamed up with communications technology firm TeleMessage, which enables financial firms to communicate freely via mobile channels whilst complying fully with FCA and MiFID II requirements. The partnership allows TeleMessage clients to integrate their mobile communications with SteelEye in real-time – covering both corporate and BYOD phones for Android and iOS devices across all mobile carriers, and including voice calls, SMS, MMS and WhatsApp chats and calls.
All mobile data from TeleMessage is ingested, indexed and compliantly stored within SteelEye in line with record keeping obligations under MiFID II and other global regulations. The data is also made instantly available for use within SteelEye’s RegTech solutions for transaction reporting, trade and communications surveillance and best execution.
“Over the past five years, mobile reporting requirements have become increasingly granular and onerous,” says Matt Smith, CEO of SteelEye. “By integrating TeleMessage’s mobile archiving solution on the SteelEye platform, we enable clients to address these requirements in an increasingly straight forward and cost-effective way. Further, the ability to monitor mobile communications alongside other financial and regulatory data is an opportunity to gain enhanced business insight.”
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