2018 set to be the ‘year of communications compliance’
2018 is going to raise the compliance bar for everyone. While many firms are still struggling to catch up with the EU General Data Protection Regulation (GDPR) due to take effect in May, those working in the financial sector have an even more pressing deadline. The European Markets in Financial Instrument Directive (MiFID II) and the accompanying regulation (MiFIR) have already come into force (3rd January).
Exactly how many institutions have yet to become compliant is open to speculation. As recently, it was suggested that 90% of buy-side businesses weren’t ready. Because MiFID II affects anyone who trades with Europe, Bloomberg’s now reporting a ‘mad dash’ for firms in the US.
Back in April 2017, The Register pointed out that “Although our friends in financial services have an increasing range of regulatory requirements to follow which are ostensibly financial regulations, what they actually have on their hands is a risk assessment and management mission. And to succeed in this mission the technology types must provide them with the information platform they need so they can rely on the data with which they’re working and use it to demonstrate compliance to the auditor and to the regulator.”
So data is key. And as the FT notes, MiFID II “will mean a wave of data, likely to be measured in petabytes. Institutions will have to report more information about most trades immediately, including price and volume.”
Ultimately MiFID II not only requires regulated organisations to not only to record electronic trades with microsecond accuracy, but also to retain trade-related mobile calls, SMS, and P2P messaging (including WhatsApp, Skype for Business and other instant messengers). Any business that does not comply could be liable for significant fines and penalties similar to those to be enforced by GDPR.
Vohkus can help implement rapid solutions that will ensure you’re ready before the deadline.
How does MiFID II affect communications records?
If you work in the financial sector you’ll have struggled to avoid MiFID II. Although the implementation deadline has slipped, and the regulators have indicated they’re willing to take a soft touch approach at first, it’s a framework that will have pronounced repercussions when it finally comes into force.
MiFID II seeks to create a more structured marketplace, with improved best execution, more orderly trading behaviour, and better transparency of costs. All trade-related cross-channel communications must be continuously and reliably recorded, and retained safely.
Automatic, integrated IM, voice, video call and desktop screen recording is obviously the way forward, because trades and communications (including voice) must be ‘readily available’ at the client’s or regulator’s request. In practice you really need all content accessible and search-ready in one place, so you can respond to any internal investigations, audits or requests quickly and easily. This approach also will also reduce the time and costs associated with e-discovery or activating legal holds if you rely on manual processes.
While trading is a predominantly deskbound activity, it is also essential to support mobile sales teams and wealth managers. So don’t overlook mobile call recording and make sure there’s support for roaming.
Unified communications and recording for financial services
At Vohkus we’ve been involved in supporting financial sector technology for over 15 years. Today we’ve built up an enviable network of partnerships with UC and recording leaders like Smarsh, Verba and Vodafone. We can help you decide which is the best solution for your particular situation, and can implement that solution safely and reliably for you. We provide both on-premises and cloud-based systems, providing agility and the rapid deployment you need to help meet your deadlines.
- Smarsh: Working with Smarsh we can help you meet your archiving and supervision needs with a platform specifically designed for the finance sector. Smarsh is a leader in the Gartner Magic Quadrant for Enterprise Information Archiving.
- Verba: With Verba we provide a complete collaboration recording solution for Cisco UC and Skype for Business. Verba ensures quality management with speech analytics, and is already deployed at over 1500 customer sites in more than 60 countries.
- Vodafone: We’re a Vodafone Total Communications partner, able to call upon its network recording, telco grade infrastructure and Tier 1 data centres to provide reliable, easy access services and secure storage.
With our solutions portfolio we can help you directly capture and retain all communications, be they email, voice, mobile, SMS, IM or even social media such as Facebook, LinkedIn, Twitter or YouTube. We also provide support for all combinations of devices, OS and ownership models, including bring your own device (BYOD).
All businesses that provide services linked to ‘financial instruments’ are affected by the new communications requirements of MiFID II. It covers not only investment banks, private banks, asset managers, custodial services providers, retail banks and broker-dealers, but also financial advisers and market infrastructure providers, so check if you’re affected now.
Drawing upon our partnerships we can arrange:
- Quick and easy audit of your current compliance with MiFID II’s communications requirements.
- Audit-based recommendations that will address your compliance gaps.
- Solution recommendations with a clear implementation timeline.
To get started, speak to one of our MiFID UC specialists today.