By Shiran Weitzman, CEO and Co-founder of Shield
Today, electronic communication apps like Slack, Zoom and WhatsApp are important to businesses when it comes to overall collaboration and communication between employees and customers. These communication apps represent a massive shift in the way we communicate across industries, especially those regulated by government agencies like the Securities and Exchange Commission (SEC). Regulated industries, like banking and finance, have historically been hesitant to use communication apps outside of monitored channels where the data could be properly stored, or “archived”. In the past, organizations could easily archive communication data when conversations were happening on business phones and email. In the modern age, however, the number of communication apps used across business makes archiving and monitoring a significant, costly challenge.
While most employees are using electronic communication apps because they are accessible, some, unfortunately, are participating in bad behavior, like money laundering, insider trading, data leaks and more. In addition to market abuse, as businesses continue to rely on WhatsApp and other electronic communication apps, we’ve also seen a rise in workplace harassment across these channels. These types of risk can cripple any business. In finance, the world’s biggest banks have already faced billions in fines, while executives with 30 years experience are being fired for simply using unapproved communication channels, even if they weren’t doing anything wrong or illegal in their communications. Banks have even started to fine employees directly if they’re caught using WhatsApp.
So what can global banking and finance executives do to ensure employees are effectively communicating both internally and with clients, while also meeting changing regulatory requirements globally?
A Siloed Approach No Longer Works
Global regulators have made it abundantly clear that record keeping and archiving is crucial when it comes to communication channels. In this time of great communication transition, however, it’s become increasingly difficult to apply a once siloed approach across all communication channels. Historically, legacy vendors were able to provide an archiving service for email and web surveillance, and another service for phone surveillance. But now? The number of electronic communications channels is driving a dire need for workplace intelligence and monitoring solutions that proactively surveil all communication channels, from WhatsApp messages to Zoom video calls, as well as the more traditional phone and email. Beyond surveillance, modern electronic communication tools must alert on all company conversations to reduce regulatory, reputational, and information risk.
Organizations struggle with electronic communication compliance because the insights they need to stay ahead of market abuse, internal bad actors, and increasing regulatory risk are invisible to them. As regulators prioritize data management and archiving across written and voice communications, global banks must break the inefficient silos between text and voice compliance. Banks need to introduce tools that offer a complete data management and surveillance platform and bring to light the invisible insights hidden throughout employee communications. This is important because conversations via communication channels always leave breadcrumbs to more nefarious or illegal activity that may be taking place internally.
Despite Historic Hesitancy, Shift to the Cloud
Financial institutions have been historically averse to moving to the cloud, but the WFH era is forcing banks to introduce new offerings that traditionally wouldn’t have been considered. Historically, banks have kept all compliance platforms on premises, however, when employees started working from home, the only viable communication option became electronic communication channels such as Microsoft Teams, Slack and WhatsApp. Crucial to continuity, banks and finance institutions had no way to monitor for market abuse as regulators cracked down on these channels.
Pre-pandemic, banks and other financial institutions relied upon on-premise data archives to meet compliance requirements, but the monumental shift in the amount of data created from today’s electronic communication channels has prevented legacy archiving solutions from keeping up with demand. When employees started working from home, the only viable communication option became e-channels such as WhatsApp, Slack and even private text messages. While this is crucial to business continuity, banks are finding it more difficult to monitor for market abuse as global regulators investigate these channels.
The complexity of traditional on-premise data management applications is hindering banks from adapting to meet regulatory requirements and accurately archiving the overwhelming amount of organizational data from these communication channels. On-premise applications also cost organizations more in the long run, as they rely on strict hardware, IT staff, new software integrations and other various costs associated with malfunctions.
What’s more, on-premise solutions also make adoption of emerging advanced technologies such as machine learning and artificial intelligence more difficult to integrate. As we continue to see these advancements being implemented through the financial industry, it’s important that banks have the ability to adopt and deploy these technologies quickly and seamlessly, on the cloud.
What’s the Solution?
Crucial to productivity and security, banks and financial institutions must simplify and standardize electronic communication channels to meet the specific needs of its organization. When employees use inefficient or unapproved applications repeatedly, it leads to frustration, a lack of collaboration and opens the business up to security vulnerabilities. Organizations must seek out the electronic communication tools best suited for their employees and operations, and then eliminate those that are no longer needed to avoid application sprawl.
After simplifying communication channels, banks should then find a monitoring and archiving solutions that ensures data privacy, while also mitigating business risks.The first signs of nefarious activity can typically be found in electronic communication, so organizations need to seek out deep tech solutions that can tailor to their specific needs when it comes to archiving, transcription, discovery and surveillance.
