Mobile Voice Recording: Meeting UK Hedge Fund Regulations Update

Following our earlier post on UK Hedge Fund Regulations, today’s blog explores mobile recording technology so you can confidently choose the best technology solution and achieve compliance with the new Financial Services Authority (FSA) requirements.  

 Let’s start by recapping on the new FSA requirements for mobile recording:

• In 2010 the FSA decided to remove the current exemption for the recording of mobile phones from its Code of Business Sourcebook (COBS 11.8 taping rules).

• Compliance deadline: 14th November 2011

• Record  all ‘relevant’ telephone conversations and all electronic communications on firm-issued mobile devices and store these recordings for six (6) months in a format that cannot be alternated and allow the FSA easy access

• Take ‘reasonable steps’ to prevent ‘relevant’ conversations on unrecorded private mobile devices 

      In preparation for the new regulation, Eze Castle’s technology experts conducted extensive research and evaluation of available mobile recording technology solutions comparing network-based and SIM card solutions.

Types of Solutions

There are four primary methods of mobile recording. These are:

• Conference-call based recording: Uses an application on the handset to automatically connect to a recorder, thus creating a three-party conference call.

• Network-based recording: Requires a SIM card replacement on handset and works with a specific mobile network

• Unified-communications based recording: Routes all calls through a company’s corporate telephone system (PBX). Requires a dedicated phone number.

• Store-and-forward: Stores the call on the device and then transmits to a remote recorder.

Technology Providers

The below matrix summarises the primary solutions on the market. From left to right, solutions are first grouped by technology ‘method,' followed by the application or SIM Card requirements, and lastly, handset compatibility is indicated. For network-based solutions, the specific network is listed below the vendor. 

 *Obsidian and Compliant Phones use a call re-direct method rather than dialing a conference-line. They are grouped here since they are fundamentally similar to conference-style in that they require an app and are network independent.

As indicated in the above matrix, conference-call style solutions, with the exception of Obsidian and Compliant Phones, only support BlackBerry handsets. Obsidian and Compliant Phones, which employ a call re-direct technology, are also compatible with Nokia (Symbian) handsets. Furthermore, all of these vendors, except Voxsmart, intend to support Android in the near future. Voxsmart remains openly committed to BlackBerry and has no plans to expand beyond this platform. Unfortunately, iPhones are not supported by any of the conference-style vendors, nor did any vendor commit to a roadmap for iPhone compatibility.

In comparison, network-based solutions all score equally with respect to SIM card replacements and handset support. Obsidian, however, provides both a call re-direct style solution and a network-based solution. This may appeal to buyers looking for a vendor-contained migration path between technology methods. Obsidian has promoted this as a distinguishing benefit.

To help firms further, we have pulled together some useful resources.

• Eze Castle’s Mobile Recording for FSA Compliance Webinar, which outlines pros and cons of each technology above, outlines findings from our trials and provides recommendations on which solution to select.

• Vodafone Whitepaper: Recording Mobile Telephone Conversations in Financial Intuitions

• FSA Tapping of Mobile Phones

• FSA Taping: Removing the Mobile Phone Exemption