A speech by Julia Hogget, Director of Market Oversight at the Financial Conduct Authority (FCA), this week has shone the spotlight on the necessary compliance arrangements for remote workers.
The Market Abuse Regulation Post Covid-19 event, hosted by City and Financial Global gave a unique opportunity for attendees to assess the impact of these changes on their compliance obligations, while the FCA presented their latest recommendations.
In the keynote address, delivered virtually of course, the tone was firm and concise. Assurances must be made by firms to manage and mitigate Market Abuse risk, be that at home or in the office. They are now one of the same and their controls should be equivalent.
Surveillance and new ways of working
Reflecting similar concerns raised in the FCA’s recent Market Watch 63, Julia Hoggett highlighted how the world of Market Abuse has changed since the beginning of the pandemic and what needs to be done to ensure compliance policies are fit for purpose in our new ways of working
“We will have to navigate huge amounts of change over the coming months, depending on the path of the virus, as we work through Return of Office models that will no doubt include both hybrid ways of working and indeed, over time, potentially long-term changes to the way we all work.”
The FCA expects firms to update policies, refresh their training and place rigorous oversight and control that accommodates new virtual working environments. Through Return of Office plans, including hybrid working models, this requires firms to adjust the way in which they think of the range of surveillance tools available to them, says the Regulator. These updated policies should prioritise the use of corporate devices where call recording and message capture can be controlled by the company to reduce where at all possible the risk of non-compliance with MIFID II.
“Policies should prevent the use of privately owned devices for relevant activities where recording is not possible. New communication mechanisms, before they are used, should have controls in place where required and their use be approved by firm management.”
At VoxSmart, we have advocated the adoption of corporate issue devices (laptops, landlines AND mobiles) as we believe this is the best way to ensure your employees are working to the best of their ability, with complete access to their client base and compliant equipment to do business.
Where new communication mechanisms are concerned, we whole heartedly support this, however, we must educate firms on the solutions available to enable their use rather that prohibit them. We recently published findings in our report on how trading communication has evolved during the coronavirus crisis and one of these insights has been the rapid increase of WhatsApp use within Markets participants. This channel is already in use by both clients and employees whether the controls are in place or not so firms must keep pace with this growing trend.
We invest heavily in R&D to ensure our Mobile Capture and Communications Surveillance tools best address key compliance concerns such as blocking certain Instant Message features if they cannot be fully compliant. We are also always developing new ways to capture emerging channels that are being used daily in the markets so firms will be able to have controls in place before approving their use.
If you are interested in finding out more about any of our Capture and Surveillance solutions, request a demo today or get in touch via email at firstname.lastname@example.org
You can read the full speech for Julia Hoggett here.
We have gathered six months of capital markets communication data and produced a high-level report highlighting some of the key insights and trends we have witnessed unfold since the start of the global pandemic. download now.