With MiFID II regulations going live in a few short weeks, financial services organizations (FSOs) around the globe are making final preparations to address its mandates. To help FSOs meet these stricter reporting requirements, NICE, a provider of financial communication compliance and trade reconstruction solutions, is adding enhanced Automated Compliance Assurance Reporting to its NICE COMPASS solution suite.
As regulators place increasing demands on FSOs to record and monitor more employees, asset classes and communications, MiFID II will raise the bar on compliance assurance. When the new regulation goes into effect on January 3, simply recording communications for all regulated users will no longer be sufficient; firms will need to provide evidence of compliance to regulators at a moment’s notice.
While Dodd-Frank, FX Global Code of Conduct and MiFID II regulations all require FSOs to record communications related to financial trades, MiFID II is the first regulation of its kind to impose an additional requirement around evidence of recording. The new mandate doesn’t only apply to FSOs in the United Kingdom and Europe; it also applies to firms in the U.S. and Asia that conduct transactions with United Kingdom and European FSOs.
“The old ‘record it and forget it’ mode of business will no longer be acceptable under MiFID II,” said Chris Wooten, executive vice president, NICE. “MiFID II exerts a requirement on FSOs to provide evidence that their recording estate is not only operational, but that it is configured correctly and is capturing and retaining all intended communications, for each and every regulated user, on a continuous basis. This new prescriptive requirement is a huge quagmire for FSOs because today, the only way to produce this evidence is to run queries in different systems to manually extract and piece this data together. FSOs that do not comply with the new regulations risk drawing negative attention and remediation from regulators, or worse, substantial fines, potentially in the millions of dollars.”
NICE COMPASS’ Automated Compliance Assurance Reporting offers auto-generated reports to audit and document communications recording compliance and on a moment’s notice, provide evidence to regulators that all regulated users’ communications are being properly recorded, archived and retained.
Additionally, NICE COMPASS’s open API (Application Programming Interface) allows it to be easily integrated with bank CRM systems, enabling the reporting engine to automatically match up regulated users in both systems (recording and CRM), to ensure complete compliance and identify any exceptions. FSOs can also use the reporting capability to track and manage legal holds. All of this information is available through NICE COMPASS’s browser-based dashboard, further ensuring compliance managers complete compliance assurance insight across the global enterprise.
“When MiFID II goes live on January 3, FSOs will need to be ready,” added Wooten. “NICE can help make the transition to MiFID II seamless. By simply layering NICE COMPASS on top of their existing NICE Trading Recording (NTR) system, FSOs can automate compliance processes, save time, and reduce the risk of fines and reputational damage.”