MiFID Regulations

Actiance Solutions for the FSA Directive on IM

Guidance issued by the UK Financial Services Authority (FSA) on instant messaging use in relation to the Markets in Financial Instruments Directive (MiFID), came into effect on November 1, 2007.

In its Policy Statement regarding Telephone Recording: recording of voice conversations and electronic communications, the FSA quite clearly implicates instant messaging, but also leaves it open to include any subsequent forms of electronic communications:

The term electronic communication has a wide application. It includes fax, email, Bloomberg mail, video conferencing, SMS, business to business devices, chat and instant messaging.  But it is not limited to these as it captures any electronic communications involving receiving client orders and the agreeing and arranging transactions.

The guidance also specifies that:

More specifically it was proposed that firms - including banks, stockbrokers, investment management firms (in general) and insurance companies - be required to record telephone lines that are used for the receipt of client orders, the negotiation, agreement and arrangement of transactions across financial markets. Firms would also be required to retain electronic communications related to these same activities (including fax, e-mail, chat and instant messaging).

And highlights some of the issues surrounding Instant Messaging usage:

There are IM solutions that are free and available on the internet. However, as reported in the Actica report: "many of the free variants have no capability to record communications and those that do, commonly provide no way for system administrators to mandate recording/archiving of conversations. Although business processes can be used with these free and internet based solutions to record and archive communications, the assurances for these solutions are low."

Conclusions

After reviewing the guidance thoroughly Actiance has determined that there are two legitimate responses to the guidance:

1. Allow secured and managed IM to be used in the organization with appropriate usage policies and technological safeguards.

Or alternatively but less plausibly:

2. Block all unsanctioned public IM and File Sharing Networks.

In both cases, Actiance's solutions have a unique value proposition. In fact, our "defence-in-depth" approach is the only way to satisfy the two possible responses to the guidance.

Unified Security Gateway is the only Secure Web Gateway to combine content monitoring, management and security of Web 2.0 applications, such as social networks and instant messaging, with URL filtering, anti-malware and Web anti-virus protection.

Vantage is the de facto platform for granular security, policy controls, and compliance features for real-time and unified communications (UC) - providing management for the widest variety of UC and real-time communications platforms, including Microsoft Lync and OCS and IBM Sametime, public instant messaging platforms such as Windows Live and Skype, Web conferencing, and industry-focused networks like Reuters, Bloomberg, and YellowJacket.

Together, these products comprise a working set that is a perfect fit for FSA member firms that are looking for an immediate and proven solution.

If you have any additional questions regarding how Actiance solutions can ensure true compliance for your workplace IM, please complete your details and we'll get right back to you.