WhatsApp Compliance and Group Messaging: Mitigating Regulatory and Legal Risks Through Mobile Archiving

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Using WhatsApp is a no-brainer for many professionals and employees in the financial sector.

Simple, personal, and secure, WhatsApp is a go-to communication tool when a critical work- or trade-related topic warrants immediate attention and urgent response from a colleague or a client. In addition to business communications, employees also use WhatsApp for casual chats, such as where they should head out for lunch, or what activities should be included in the next company team building.

Offering increased collaboration, better employee productivity, faster and better-informed decision making, and quicker response to urgent business matters, employees across the financial industry broadly enjoy the benefits of WhatsApp inside and outside the workplace.

However, how can you control its use if you are under the strong scrutiny of FINRA, SEC, FCA, and MiFID II?

This is the question that still challenges many compliance officers in the financial sector, because like with other useful tools, the benefits of WhatsApp also comes with rather extremely challenging risks – namely regulatory and legal risks because of free-flowing work- and client-related information through the network.

Here are some what-if scenarios that illustrate the different ways WhatsApp could put your business at serious compliance and legal risk:

  • The marketing director asks the email accounts clients from a team of investment advisors, who sent the requested information through WhatsApp. This client-related information now exists with the business network, which can be easily accessed by a skilled hacker by hacking enterprise Wi-Fi network or stealing the IMEI number of the employees’device
  • HR requested of new employees to send over their social security number using WhatsApp so they can complete their payroll account setup. This sensitive information, when hacked, can be used by outside parties to steal identity and do almost everything a legitimate SSN holder can do.
  • A broker-dealer sent a WhatsApp message from another broker-dealer about a certain trade which they are not allowed to discuss in the first place. When not flagged, your company could face a hefty monetary fine for failing to detect and investigate potentially suspicious transactions.

Read more: Top WhatsApp Crimes in Financial Services

  • A few investment advisors sent inappropriate remarks on one member of their team through WhatsApp. If it goes unnoticed by the HR, it can lead to a lawsuit which can affect the morale of your employees, your brand reputation, and your operational efficiency.
  • The OCIE request copies of all business communications in which trade executions and reporting have been discussed in workplace conversations. You must now deliver all these records – complete and unaltered – in a requested format. If you do have the capabilities to do so, you are now at risk for non-compliance fines for breaching SEC and FINRA retention requirements.

As can be seen in these examples, WhatsApp is a hotspot for potential data breach, suspicious trade activities, employee conduct violations, and non-compliance to key archiving regulations. With chat conversations and text messages increasingly being requested for eDiscovery and regulatory audits, your organization faces greater compliance and legal risks that come with significant financial ramifications.

Achieving WhatsApp Compliance Through Mobile Archiving

WhatsApp compliance is a real challenge for any financial firms where most employees rely on this platform for day-to-day mobile communication needs. Considering that the app itself isn’t designed to securely capture and record messages and its metadata, financial firms require a unique solution that will help them utilize this platform while satisfying the mobile archiving requirements of FINRA and SEC.

TeleMessage’s WhatsApp Archiver is a unique platform tailor-made to solve WhatsApp compliance and regulation issues by allowing financial firms to capture and archive WhatsApp messages including conversations that transpired in group messaging threads. This platform works exactly like the standard WhatsApp application, ensuring that your employees will still be able to send work-related communications easily and quickly.

The benefits of using WhatsApp Archiver in your business include:

  • Archive all WhatsApp communications
  • Use WhatsApp to communicate with customers, employees, and stakeholders
  • Search, track and retrieve WhatsApp messages in the corporate archive
  • Deposit WhatsApp messages with any email archiving vendor
  • Full administration and reporting

The TeleMessage WhatsApp Archiver is the latest addition to our mobile archiving products that securely capture content from mobile carriers and mobile devices for a variety of ownership models (BYOD, CYOD, and employer-issued). With our multiple archiving methods, you can always find the right tools or blend for your requirements:

TeleMessage offers cross-carrier and international mobile text & calls archiving for corporate and BYOD phones. Contact us today to learn more about our mobile archiving products.

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