Calls may be monitored

Preventing, detecting and deterring market abuse is one of the key priorities in mobile recording but as the FSA review regulations firms may experience a transition period

by Paul Williams

16 September 2010

 

After a number of high profile cases involving financial institutions and their clients, the FSA have reviewed the need for regulated companies to record all mobile phone calls and SMS texts between their employees and customers.

At present, mobile phone communications are exempt from their regulations regarding call recording. The FSA ended their consultation period in June this year, and is currently reviewing the information collated. It is expected that all electronic communications including, email, mobile and instant messaging, as part of legislation, must be recorded and retained.

Should a decision be taken to remove the exemption, there will be a transition period for firms to make the necessary changes. The FSA anticipate a transition period of a year from the time a decision is taken to alter the rules (which they would not expect to happen until late 2010) to implementation by firms.

The current rules regarding fixed line recording, require firms to record ‘relevant communications’ and keep them for six months. These rules, which became effective from March 2009, were aimed mainly at tackling market abuse – although the FSA taping rules also assists in their conduct of businesses supervision – by ensuring they have access to high quality, contemporaneous evidence to help monitor, investigate and prosecute such cases.
Although financial companies commonly record calls on fixed line as part of FSA regulatory requirements, mobile calls and SMS texts, due to the technical complexity involved, have not been subject to the recording regulations. The technology to record, store and retrieve mobile communications has, however, advanced. Firms now have a choice of ‘hosted’ or ‘in-house-integrated’ solutions and a wide range of suppliers to capture relevant mobile communications.
Good quality recordings of voice conversations and of electronic communications help firms and the FSA detect and deter inappropriate behaviour. Mobile recording will allow companies to archive voicemail, conversations and texts to assist with any disputes and complications, thus improving compliance protocol and procedure.

 Implementing a recording solution is also expected to help firms more speedily resolve any internal disputes arising from employee or indeed employer misconduct.

In the finance sector, the use of mobiles  rather than fixed line handsets has risen considerably, so the introduction of a mobile recording solution will help companies meet key compliance and risk management objectives and demonstrate the intrinsically good and bad aspects of day to day customer liaisons.

Although the FSA have been instrumental in bringing the necessity of mobile recording to the public domain, the likelihood of other business sectors adopting a similar policy, for the reasons already outlined, is inevitable. Mobile communications have become ever more dominant in decision making, so recording of all activity makes perfect sense.

Recording providers will align the service with existing communications systems, thus avoiding major infrastructure change allowing reuse of working assets. Times of recording can be set to conform with regulators and it is possible to omit personal calls from the facility so as to make sure that all calls and texts are business orientated.

Users can go on line via a secure server to access and review all mobile correspondence, immediately after a call or text has been made or sent. Access to the on line element can obviously be restricted to managers and senior employees however HR departments will probably have to adapt company policy regarding employee privacy and as to how long records should be kept. This can vary from 1 hour to up to 3 years.

The information stored is available in a preferred audio formats and SMS texts are collated as a simple print friendly log entry as originally sent, including grammatical errors and predictive text. At present, there is no mobile recording service that supports recording MMS (Multi Media Service) content, such as attachments and images. Only a record of date, time and recipient is stored.

In the first instance, buyers and managers should approach their network providers and discuss possible options. Those working in the finance sector will no doubt receive, in due course, information from the FSA outlining the results of the consultation period undertaken earlier this year.

The nonintrusive aspect and ease of use will make the procurement process a simple task, without the need to change existing communications platforms, thus a non disruptive and smooth introduction can be made. And, with the ever progressing innovation in the telecoms market, recording facilities will evolve to monitor all capabilities of smartphones and handsets, from web browsing and downloads to media and data usage.

Why mobile recording?
• Records and stores voice calls and SMS on your existing recording infrastructure
• Automatic recording, with no user intervention required
• User-friendly – aids enhance user acceptance
• Employees keep existing mobile numbers
• Compatible with major device platforms – re-use existing assets
• Compatible with Roaming
• Global, managed solution with uniform global deployment
• Enables out-of-office/out-of-hours trading
• Enables certain calls to proceed without recording, for example calls to/from employees’ home numbers
• Discourages employees from carrying a second ‘personal’ phone

Paul Williams is the marketing and comms officer at FGE Communications