Within this period, advisers must keep the records in a way that means the original cannot be altered or deleted, is accurate and complete, and must be readily accessible and available to the client or the regulator on request.
Records must be stored in an unalterable medium such as Write-Once-Read-Many, which allows for records to be replayed or copied. Records must be searchable and readily available.
Will Brexit have an impact?
One question I’m often asked when businesses are thinking about their compliance with Mifid II recording requirements, is “does Brexit matter?” And the short answer is: “no, it does not”.
Because the UK will still be a member of the EU on January 3rd 2018, IFAs that fall under the regulation must comply with the changes to UK laws and regulations. Even when the UK leaves the EU, the current expectation is that it will wish to keep its financial services laws in line with EU standards, to achieve an 'equivalence' status to help cross-border trade to continue.
The benefits of wide-scale recording
So, given that the regulations are wide ranging, and will come into force in the New Year regardless of where the UK is with Brexit negotiations, it may be that taking a holistic approach, and choosing to record more widely, will be easier and cause less confusion in the long run.
By implementing communication recordings, firms and individuals benefit from:
- Centralised data storage for communications.
- Easily searchable communications.
- Communications that are readily available to compliance teams, auditors and individual requests.
- Quick, cost effective dispute resolution and trade reconstruction.
- Readiness for future regulatory burdens, avoiding costs and business disruption in the long term.
- A cost-effective, holistic approach to compliance, risk mitigation and data analysis.
How do we get our house in order, in time?
So, with only weeks to go, there is time to get your house in Mifid II order and the four-step check point plan below can act as a basic guide for those unsure of where to go next:
1) First, conduct an audit of your wider communications – think about how you (and your employees if you have them) use business and personal devices in your work.
2) Track yourself for a day – spend one day paying close attention to the calls you make, the websites you visit and the apps you use. Did you use LinkedIn or Facebook to communicate with a client? Did you discuss with them any transactions? If so, you might want to set up a way of saving these messages somewhere central where you can review them in future.
3) Speak to your clients – be open about the regulations, what additional processes might be in place because of recording requirements, and why you as a business are making the changes.
4) Seek support when and where you need it – it may be that you don’t have the internal capability to implement the changes needed to ensure your business is compliant, but there are a lot of options for external support. Several businesses can offer their global customer base enhanced capabilities around mobile and fixed-line voice communication within an archiving platform.
