FSA call recording survey throws up surprises

TeleWare have announced surprising findings from the first survey of financial services organisations following changes to FSA regulations around call recording which came into effect a year ago.

The survey, carried out by Financial Sector Technology Magazine, highlighted that 29% of firms are not yet or feel they have no need to comply with the regulations and, of the majority that have, a further 53% are meeting compliance by restricting the use of mobile phones within the workplace.

“The survey makes interesting reading, especially the fact that a third of all FS firms believe that telling workers not to use mobiles is an effective long term strategy – this seems somewhat misguided,” comments Steve Haworth, CEO , TeleWare Plc. “This position may offer a defensible policy to appease the FSA but is probably not productive or enforceable. The position could potentially result in ‘necessity breaches’ where a travelling trader needs to make a critical call from outside the office environment to conduct a regulated transaction that is not recorded. This will clearly result in an FSA breach and, worse, the breach has been forced on the trader by a lack of mobile recording at a corporate level,” added Haworth.

In Haworth’s view, it is clear that the financial market still see this as a ‘forced compliance’ solution and are not yet looking at the additional benefits of managing risk in this manner. “There are a few institutions that are looking at these services to drive real benefits and to preserve their reputation when potential breaches occur. As banking has been built upon trust and reputation, it comes as a surprise that these customers seem to be a minority of the market,” he notes.

The survey questioned 100 directors and departmental heads of UK financial institutions and of UK branches of international institutions. Areas of responsibility of those interviewed were infrastructure and technical, risk and compliance. From the 47% that have a solution to meet mobile call recording regulations, around a third still don’t have a fully operational platform.

“The bulk of deployments are spread between client-based and SIM- based solutions,” explains Haworth, “However, the client landscape with new versions of Google Android, Apple IOS, Windows and BlackBerry operating systems is like shifting sand – we suspect that many organisations trying to stabilise a call recording solution that needs a software client on each device are struggling to deploy a viable solution,” said Haworth.

TeleWare Mobile uses a normal Subscriber Identity Module (SIM Card) which works with all top mobile phone types, including any Apple iPhone, BlackBerry, Android or Symbian handset or pad device. The network offers full Voice, SMS and Data and supports roaming in 265 countries. TeleWare offers full number porting and provides a range of common core business applications and call routing options.

The managed service records and stores mobile voice and SMS (short message service) traffic with no impact on the user call experience and without limiting the mobile’s functionality. The SIM-based approach can support any GCF (Global Certification Forum) certified mobile handset or operating system and as there is no need for any software to be installed on the mobile device; delays in call connections and potential circumvention of recordings are avoided.

TeleWare Mobile also integrates with standard geographic and non-geographic numbers as well as short code dialling, premium rate numbers and operator services. TeleWare Mobile interfaces with any SIP compliant PBX and has been tested with products from Cisco, Avaya, Alcatel-Lucent, Siemens and Panasonic and over 30 leading vendors.

TeleWare estimates that it has 61% of the SIM-based call recording market and works extensively through a partner network including BT, Business Systems Ltd and Moberec. Haworth adds, “It is a credit to our customers and those of our competitors that there are financial institutions in the City of London that take regulatory obligations seriously and look to put the relevant solutions in place. Adoption is clearly growing and we welcome this survey which offers an insight into the evolving market.”

“It is no real surprise that take-up of mobile call recording has been so poor. Some of the providers had technical problems shortly after the regulation came into force, which a lot of the banks saw as an opportunity to push back on the legal requirement. A number of smaller firms on the buy side have been granted temporary exemptions by the FSA and, overall, l it would seem that the sector is in no hurry to comply. Ovum expects this situation to change over time, but it’s going to require concerted effort on the part of the vendors to deliver a reliable service,” says Rik Turner, Senior Analyst, Financial Services Technology, Ovum.

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