Global Banking and Finance Review speaks to Mark Miller, General Manager at TeleWare to gain an overview of the compliance issues concerning the use of mobile technologies and the solutions involved.

Mark Miller

What are the risks for the financial service sector with mobile technologies?

I think there are 4 aspects of risk

• First is non-compliance with the Dodd-Frank regulations which could result in substantial fines by CFTC.
• Second risk is that wrong doing by users using mobile technology which is not monitored and recorded, places the financial institution’s brand and reputation at risk. By recording and monitoring the user utilizing mobile technology it also reduces their financial exposure of wrong doing.
• Thirdly there is the risk that by excluding mobile technologies to traders and their supporting personnel it would reduce their responsiveness to clients and make them less competitive than a bank that has chosen to deploy mobile surveillance technologies such as mobile recording and analysis of the metadata and voice content.
• Fourthly, the data captured is an untapped source of business insight. The ability to derive trending information or sentiment can add to the competitiveness of the financial firms. The risk is that they would be less competitive than their rivals in the market.

What is the mobile call compliance need for Dodd Frank and how is TeleWare helping companies achieve compliance?
There are specifically 2 sections that call upon oral communications specifically mobile communications to be recorded and reproduced during audit from the regulator which applies to Futures commission merchants, retail foreign exchange dealers, introducing brokers, and members of designated contract markets or swap execution facilities.  This applies to firms with greater than $3Bn annual swap volumes and is roughly 65 institutions in the US and around 28,000 traders. The CFTC is currently discussing the extent to which this is applied beyond the US borders especially because swaps are common in forex trading.

The 2 sections can be found at:
http://www.ecfr.gov/cgi-bin/text-idx?SID=b1c4bfbb2862ae809faeb3cd878ec8bf&node=17:1.0.1.1.1.0.5.34&rgn=div8

http://www.ecfr.gov/cgi-bin/text-idx?SID=b1c4bfbb2862ae809faeb3cd878ec8bf&node=17:1.0.1.1.22.3.7.3&rgn=div8

Why should financial firms not rely on mobile app based solutions?
The app based solution is easily by-passed by the user, by various means. As the user experience is significantly impacted by delays in making and receiving calls it has been found to be inadequate solution in the UK market. The UK market has rejected this as a practical solution, although many adopted it in Nov 2011 as the regulation became enforced, primarily to buy themselves more time from the regulators. Most are moving to In-network SIM-based solutions such as TeleWare’s.

When it comes to BYOD what is the best policy you see for financial service companies?
We believe and this is being confirmed by many clients, that the use of personal devices and the impact of consumerisation of business mobile technologies is inevitable. Firms that embrace this and figure out how to make it secure, compliant and cost effective will ultimately be competitive and customer service focused. The choice of mobile device management and associated technologies that provide separation of personal and business applications, which Blackberry did so well. There is believe that somehow the operating systems of the various vendors such as Microsoft, Google (android) and Apple (iOS) will resolve the security, control and separation that Blackberry provided. It may, but solution that are focused on mobile device management – which is a lot of what the Blackberry Enterprise Server BES provided – today provides the security and control. When combined with containerization software it can provide a complete replacement of what is expected in the business world, especially in the financial services sector.

These days more and more consumers are selecting alternatives to BlackBerry. What risks are involved when migrating from BlackBerry and are there any risks associated with the different types of mobile technology?
Almost all clients we encounter are strategizing or have already made the first steps away from Blackberry due to uncertainty of the company and its products. The main risks are security of applications and use which come from the consumer part of the phone device. It can import malware and other security risks into the companies’ network. The separation of personal and work applications and use is tied into the risk of security. Blackberry is especially used by regulated users because of its strong security of messaging and data via the Blackberry Enterprise Server and the cellular service providers. Mobile Device Management along with Containers (separates personal and work on a consumer device) can replace most if not all aspects that blackberry provides today. In fact TeleWare see the demand of this outweigh or complicating the drive by financial services firms to have compliant mobile phones for Dodd-Frank. To that end TeleWare is developing a cloud-based MDM service that provides containerization along with a managed service to migrate users from the current state to BYOD or mobile platform of their choice. As part of that service TeleWare will ensure that regulated users subject to Dodd-Frank are compliant.

Outside of compliance what other solutions does TeleWare offer?
Teleware provides Fixed Line Recording solutions for compliance as well as contact centers. TeleWare also offers Inbound Call Management for mobile professionals including the ability to record on demand for vertical sectors such as Retail, Health, Legal and Accounting. TeleWare has a number of Hosted Business Phone Service deployments with leading firms in the UK offering simple phone service to ACD, Auto-Attendant, IVR One Number etc.

As part of the TeleWare plc group there is Private Mobile Network PMN –which provides extension of the PBX to the mobile device enabling mobile phones to become part of the internal telephony infrastructure while in the vicinity of the workplace. PMN has also been utilized by the armed forces in the UK and US for creating instant mobile networks.