40% of financial firms at risk of MiFID fines

Pedro Gonçalves
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About 40% of financial services firms do not have suitable processes and technology in place to capture, record and consequently retrieve real-time business communications, putting them at risk of non-compliance with MiFID regulations, research shows.

Firms that don’t comply with Article 16 of MiFID II risk fines of up to five million euros, or 10% of their annual turnover.

A research conducted by TeleWare showed that only 60% of employees in the financial services sector have suitable processes and technology in place to capture, record, and retrieve real-time business communications as required by MiFID II.

“Financial services firms have been dealt a tricky hand in 2018, with MiFID II and GDPR coming into force just months apart. And with some contradictory requirements when it comes to the recording of personal data.

As the threat of non-compliance is so high, it’s critical that firms make the necessary investments in technology and infrastructure. Ensuring all employees have the tools to be compliant. Our research has shown that firms that do so will reap significant benefits in return, in addition to mitigating the compliance risks,” Steve Haworth, CEO of TeleWare, said.

The same research revealed there are benefits available to firms from embracing communications recording.

Employees in the survey agreed that if they could record and recall information more effectively, this would benefit the business by: improved customer experience (58%); better customer service (55%); improved employee productivity (54%); and increased collaboration across the business (36%).

The Markets in Financial Instruments Directive (MiFID) is the framework of European Union legislation for investment intermediaries that provide services to clients around shares, bonds, units in collective investment schemes and derivatives (collectively known as ‘financial instruments’).