Regardless of size, all financial institutions must contend with regulatory requirements to appropriately monitor, capture and safeguard work-related communications. Any gaps open the door to financial crime, poor market conduct, and harmful workplace cultures, ultimately jeopardising customer assets and undermining market integrity.

For this reason, regulators globally, including the SEC, FINRA, and FCA are imposing heavy fines for non-compliance. Getting it wrong can have devastating impacts – from multi-million-pound fines to reputational damage, inadequate risk management, and non-compliance can be extremely costly.

In this environment, investment in eComms surveillance is a necessity rather than an optional expense, with the cost of not investing in effective surveillance easily outweighing the cost of investment itself.

Just a few weeks ago, the FCA fined Nationwide £44m for failings in financial crime controls from October 2016 to July 2021. Specifically, the FCA found that ‘Nationwide was unable to effectively identify, assess, monitor or manage the money laundering risks’ relating to a portion of their customer base. Similarly, the FCA has fined Monzo Bank Ltd £21m for its inadequate anti-financial crime systems and controls between October 2018 and August 2020, as well as fining Barclays £42m for poor handling of financial crime risks.

As these enforcement actions demonstrate, robust risk management frameworks are mission-critical, but obligations go far beyond managing risk at the firm level. Organisations must also manage the risks and potential regulatory breaches that arise from the professional and personal conduct of individual employees: from financial crimes (such as insider dealing and money laundering), to customer-complaints handling, and HR or ‘non-financial misconduct’ issues.

It is important to note that, although a breach of internal policy may not amount to a breach of regulatory rules, there is nonetheless a need for firms to focus on oversight of and improvements in behaviour. The FCA, for example, states that ‘repeated breaches of a firm’s own internal policy – especially if it involves a senior leader or reflects an increasing trend – may still warrant supervisory attention’.

Why Tailored eComms Surveillance Matters

Tailored eComms surveillance is the only way to ensure effective compliance. This means monitoring all communications while maximising efficiency through targeted workflows, specialist foreign-language review, and bespoke reporting supported by trend analysis. This equips HR teams, service delivery managers, and in-house legal teams to address risks as soon as they are identified.

For everything from policy breaches to workplace misconduct, or complaints, a dedicated team can compile all the necessary information, including contextual or supporting evidence and a clear audit trail, to assist the relevant internal stakeholders, and even external regulators, with any further action or investigation.

Crucially, proactive monitoring also means that, where potential issues are found, teams can act quickly to mitigate risk and reap the benefits of self-reporting where necessary.

With a managed eComms surveillance service, firms can effectively manage all types of risk with in-house staff only being involved as needed, thus relieving them of day-to-day burdens such as initial review, case management, and evidence gathering.

The Role of Technology: Efficiency, Not a Panacea

Modern eCommunications surveillance solutions powered by AI significantly enhance compliance efforts with:

• Automated Flagging: Moving from manual reviews of a sample of communications to automated analysis of 100% of the archived data.
• Reducing False Positives: AI-driven analytics can drastically reduce the ‘noise’ from false alerts, which are a major time sink for compliance teams, thereby freeing up resources for higher-value work.

However, AI and related technologies are not a standalone solution or ‘silver bullet’. Applying sophisticated technology to poor quality data only adds complexity, and human oversight remains essential, especially where human conduct and its context are central to risk assessment.

Beyond Technology: A Holistic Approach is Key

A truly successful strategy incorporates several integrated components:

Integrated Systems

AI-powered ‘first pass’ review and automated triage, combined with human-in-the-loop support, is critical to ensure an efficient but holistic, and contextualised and therefore meaningful review of the content at hand.

Clear Policies and Training

Firms must establish and enforce rigorous policies regarding personal and professional conduct, embedding regulatory requirements and trading rules. Approval and escalation chains must also be made clear. All of this must then be supported by ongoing staff compliance training and a culture of transparency.

Continuous Review and Adaptation

The geopolitical and regulatory landscapes, as well as the market itself, are constantly evolving, requiring firms to be agile and adaptive. As such, the surveillance programme must be regularly risk-assessed and calibrated to reflect changes in everything from business practices and market conditions to slang/cultural references. Review specialists operate on the frontline and therefore provide key insights to assist firms in being responsive to changing and emerging areas of risk.

Conclusion

Advanced eCommunications surveillance technology is a powerful and necessary tool for navigating the modern regulatory environment, but it functions best as part of a comprehensive, strategically planned risk management framework. It is the intelligent application of this technology, supported by robust policies, bespoke targeted workflows, and human expertise, that ultimately drives efficiencies and mitigates the rising costs of regulatory compliance.