Solving the off-channel communications conundrum
Firms attempting to meet regulatory requirements for monitoring employee use of off-channel communications for business purposes face a bedeviling number of obstacles.
How much is enough, in the opinion of regulators? How much is too much, in the eyes of employees? Is using internal policies, controls, and training sufficient, or should a firm consider hiring a vendor to help?
In a series of stories, Compliance Week will take readers through issues related to monitoring off-channel communications use by employees of entities registered with the Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission (CFTC). Any firm under criminal investigation by the Department of Justice (DOJ) might also face scrutiny of their employees’ use of unapproved electronic communications.
First, understand regulators’ expectations remain high. In future examinations, the SEC and CFTC are likely to continue finding new misconduct related to off-channel communication use by registered entities. Their response will be to penalize past transgressions, require mitigation, and extract promises that a firm is back on a path to compliance.