FCA Publishes Paper on COVID-19 and Recording Communications

By Kyte Ekstrom | Brexit, communications, Compliance, FCA Regulation, Financial Industries, FinTech, News | 0 Comments

The idea of working from home; not having to drag yourself out of bed at the crack of dawn and foregoing the drudgery of the daily commute, seemed like an unattainable pipe dream less than a year ago. Now, ten months since the first lockdown, working from home looks set to be the norm for sometime to come.

So, straighten up your pj’s, get comfy in your home office, aka on your sofa, and let us inform you of the salient points of Market Watch 66, the FCA’s recently published paper regarding the expectations for firms on recording telephone conversations and electronic communications – when alternative working arrangements are in place (e.g. when a pandemic strikes and we are all working from home).

In short, the document confirms the FCA’s expectation for firms to continue to comply with the recording obligations in the Senior Management Arrangements, Systems and Controls sourcebook (SYSC 10A).

Firms are expected to comply with the following:

  • Ensure that where unmonitored and/or encrypted communication applications are used for in-scope activities on business devices that they are recoded and auditable. in-scope activities include arranging of deals and dealing (as principal or agent) in investments, managing investments, as well as managing a UCITS, an AIF and/or establishing, operating or winding up a collective investment scheme.
  • Recording obligations apply to conversations and communications made with, sent from, or received on, equipment provided or permitted to be used for business purposes.
  • Firms must ensure that their recording policies can identify calls and communications that directly relate to in-scope activities, also identifying communications intended to lead up to these activities, or where there is a reasonable prospect of such activities being performed. Depending on the circumstances, this may also include internal conversations concerning in-scope activities.
  • If new or amended policies, or new technologies are introduced, the FCA expects firms to provide training covering the amendments/ new policies and the use of new technologies and consequent risks which may arise.

FCA Market Watch 66

The FCA has also updated its COVID-19 information page highlighting their expectations for firms to record all relevant communications (including voice calls), when working outside the office. They urge the importance of preventing market abuse risks and note that firms with concerns about meeting obligations, due to coronavirus, should contact the FCA via regular supervisory channels as soon as possible.

FCA Covid-19 Information Page

What you can say, and what you can not say (unless it is being recorded) that is the question!

If you have concerns about complying with the FCA’s expectations relating to recording business communications, we can help. We are the UK’s only compliance consultancy to specialise exclusively in fintech, meaning we understand your business and your needs. Our dynamic team all hold industry qualifications and are up to date with the latest compliance regulations.

Get in touch to discuss an audit to review your working from home practices. Our Audit service involves taking deep dive look into your businesses activities and processes to determine the level of compliance required in order to fulfil regulatory requirements. Think of this service as a ‘health check’, which can range from checking on one element of your business or a full-firm-wide review.

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