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Electronic Communication “Let’s Talk Supervision”

Compliance risks exist in your electronic communication. How will you effectively manage these risks? With the volume and velocity of information flowing through electronic communications channels, supervision has become a real challenge. Mitch Atkins presented at the Actiance Executive Briefing Series in New York on April 7, 2016 on how organizations can leverage their electronic communications applications to comply with regulatory requirements. Entitled, “Let’s Talk Supervision: Freedom with Responsibility” the talk took place at the Viceroy hotel in Midtown Manhattan. Among the topics discussed were:

  • FINRA 2016 examination priorities
  • Electronic communications requirements
  • Managing volume in supervisory reviews
  • Common challenges in managing reviews
  • Supervision of non-email content

Atkins discussed recent FINRA disciplinary actions that involved electronic communications rules violations, including two from the 1st quarter of 2016 in which FINRA named individuals, including a Chief Compliance Officer. CCOs are faced with many challenges from day to day and some of those include managing the review of electronic communications. During the presentation, Atkins stated that excessive volume, low value keywords, lack of training for reviewers and representatives, and insufficient internal controls contribute to failures in thia area. He emphasized that electronic communication channels are dynamic as is the language that is used through these channels. As such, supervisory systems related to electronic communications must also be dynamic. Keyword flagging databases must be updated frequently and should be developed with the input of the supervisors of the departments for which electronic communications are being monitored. Additionally, broker-dealers must develop and document that training has been conducted for associated persons who use electronic communications. He advised that systems of supervisory controls such as annual attestations by associated persons as to the electronic communications channels they use and that they understand the prohibition of using outside email or non-email channels for business communications. He recommended periodic testing of electronic communication channels to ensure that all are being captured in supervisory systems. He also queried the audience whether, in light of FINRA’s recent emphasis on culture of compliance, they know what culture is appearing in their electronic communications.

Electronic Communication Live Webinar

Additionally, Mitch Atkins was a featured presenter at the Actiance “From Supervision to Surveillance” webinar on April 12, 2016. This session also cover challenges in surveillance of electronic communication. View more information about the live webinar here. Another session will occur on May 5, 2016, and it is not too late to register.