In January 2018, the MiFID II EU legislation took effect, significantly extending regulatory requirements within the UK.
Mobile Voice Recording is therefore a priority for anyone involved in the advice chain for an intended trade must now record and retain their landline and mobile voice recording communications for five years.
The age of mobile voice recording;
While current FCA regulations are specific to those directly involved in financial trading, MiFID II will more broadly apply to all organisations providing financial advice that may lead to a trade or investment.
Who is impacted?
- IFAs, wealth managers and others currently exempt from regulation will now fall under MiFID II and therefore the requirement to record, store and periodically monitor phone calls.
- The MiFID II regulation will see the number of recorded users increase from 30,000 traders in the City of London to well over 300,000 across the UK.
- What changes does MiFID II mandate?
- Current regulations stipulate that only conversations involving individuals directly involved in a trade need to be recorded. MiFID II builds on this, requiring that mobile voice recording and landlines be recorded for anyone involved in the ‘advice chain’ that could lead to a trade.
- The retention period for call recordings is significantly increased. Currently, organisations need to retain their call recording data for just six months but under MiFID II this will extend to a minimum term of five years.
- Organisations can currently meet regulations by simply recording and storing calls for the required duration. Under MiFID II, compliance officers will be required to periodically review calls and be able to demonstrate to the regulator that they have done so.
- Compliance officers must be able to prove to the regulator that they have documented and implemented policies and procedures to oversee their call recording requirement.
Going beyond the regulations
Many organisations are naturally concerned with the call recording requirements under MiFID II. Typically, this will be the first time they have had to record mobile phone calls, and even those who already do will be considering the impact of workloads for compliance teams, the costs and technicalities of storage and the enforcement of new procedures to meet the enhanced regulation. For those that fall under the regulation, MiFID II is very much a forced investment rather than one of choice. However, for financial organisations and their compliance personnel, there is a comfort to be had from leveraging the regulation to tighten trading practices and ultimately defend reputation.
The Recording landscape
Mobile voice recording solutions have been available to the market for several years. Competing technologies have naturally evolved, culminating in two approaches network layer and application layer call recording, Vital-Telcom cover your business for both, so your compliance team have peace of mind and you may concentrate on reunions your business.