Customer protection and modernization are at the top of the Securities and Exchange Commission’s (SEC) agenda for 2022 and beyond. With the COVID-19 pandemic’s impact on remote work, a new emphasis on compliance for digital communications will affect every financial services firm and bank.
That can have a big impact on enterprises, because in only the past year, Teams usage has increased to more than 150 million monthly active users. That’s why Microsoft and the compliance experts at Theta Lake are working to provide extended compliance and security through Microsoft Teams with their Security and Compliance Suite and Theta Lake Realtime Compliance Advisor.
Regulators work to stay ahead of innovation and change
From a practical standpoint, the growing use of digital communications applications such as Teams poses new functional and regulatory challenges. For example, the SEC recently made clear in an enforcement action against a global bank that investment brokers have a high standard to meet in terms of recordkeeping obligations—a standard the firm fell short of when some of its employees discussed business matters on personal devices. Subsequently, on the heels of the enforcement action US Regulators have launched a broad investigation over other global banks misuse of messaging platforms.
“As technology changes, it’s even more important that registrants ensure that their communications are appropriately recorded and are not conducted outside of official channels in order to avoid market oversight,” said SEC Chair Gary Gensler of that case.
As Gensler made clear, baseline compliance will no longer suffice to comply with SEC regulations. Firms must take a more nuanced approach to consider the potential risks associated with using each feature of a communication platform to ensure that deployment aligns with the anticipated needs of examination and investigation teams.