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UK financial institutions will soon
have to record and store telephone conversations and
electronic communications relating to client orders under
new regulations to be introduced by the Financial Services
Authority (FSA). From March 2009 FSA regulated firms will
have to record all telephone conversations and they will be
required to retain the files for six months.
The FSA regulations are being introduced in line with an
EU review, including the addition of a call recording
requirement, under the Markets in Financial Instruments
Directive (MiFID). The introduction of the recording
programme is part of the FSA's efforts to combat market
abuse, particularly insider dealing and market Call
recording gives you a permanent record of telephone
conversations providing an invaluable tool for business.
A few industry insiders believe the new FSA regulations
are a really positive thing. Not only will the new rules
help companies avoid allegations of insider dealing, it will
help their TCF (Treating Customers Fairly) policies and
protect them in the event of a transaction dispute.
For some time now the FSA has asked its members to be
proactive about keeping records of communications, in order
to protect both the members themselves and their clients.
Unfortunately, as the bulk of organisations take the stance
that 'if it's not a requirement, we're not interested’; the
FSA now clearly deems legislation to be the only way
forward.
Although most financial companies would be aware that
they need to comply with FSA regulations, it may come as a
surprise to hear that a retail company was recently fined
£210,000 and its MD personally fined £14,000 by the FSA.
Land of Leather were fined for allowing its sales force to
sell Payment Protection Insurance (PPI) on loans without
effective monitoring or training in place to ensure that the
insurance was being sold fairly. |
