The MiFID (Markets in Financial Instruments Directive) is the EU legislation which applies to financial services firms involved in investment services and activities. The original legislation was applied in the UK in November 2007 and was intended to result in a more transparent and balanced marketplace across the EU.
MiFID II, which will come into force on 3rd January 2018, will extend these requirements with the principal aims of achieving further increased levels of transparency to improve investor protection, standardising practices throughout the European marketplace and reinforcing supervisory powers.
Whilst many elements of MiFID II are already in place in the framework of the UK regulator, the Financial Conduct Authority (FCA), there have been some additional requirements set out for the UK in the FCA’s own recent policy statement.
What does this mean for my data?
As the technology partner for a number of FCA regulated firms, Pro Drive has been asked to consult on information compliance to ensure its clients comply with MiFID II. Essentially this requires that:
all communication that may influence or lead to a financial decision being taken must be retained – we recommend for at least 7 years
In practice, this means a number of things:
One of the key requirements from an information compliance perspective is the requirement to record all telephone conversations. Whilst not entirely new, this requirement becomes far more wide reaching and calls must now be stored for longer – at least 5 years. This is not just related to office phones but any phone on which a conversation may occur that could lead to a financial decision. So for most firms, mobile phones are likely within scope.
With the proliferation of smartphone and desktop based messaging services (eg. Skype and WhatApp), it is invertible that these are already being used in business, and for financial services firms there is a high likelihood that conversations through these services will come under the scope of MiFID II. There is therefore a need to prevent access to such services unless conversations are recorded and retained in a compliant manner.
A large proportion of Financial Services firms already keep a record of all email communications from staff for compliance. However this requirement is reinforced by MiFID II and these email transactions much be recorded and retained
In much the same way as telephone calls must be recorded, any conversation leading to a transaction which takes place over a video conferencing system must also be recorded. This can be problematic as these conversations can take place through a variety of mediums from traditional videoconferencing suites through to Skype or similar applications or even Facetime on a smart phone. As with instant messaging, preventing the use of applications that cannot be recorded practically or within budget may be the approach here.
What is the next step?
Pro Drive has a range of packages to provide compliant recording of calls, conferencing, messaging and email with data backed up and retained securely in the cloud in line with the MiFID II framework. All services are full monitored and managed to ensure you can focus on your business and not worry about whether your data retention is compliant.
Contact our Sales Team today on 0330 124 3599 today to find out more.