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Concerns around
communicating
compliantly

What is the highest priority when ensuring compliance with electronic communication channels for business activity?

Behavioral issues

The most prevalent non-compliance issue within regulatory enforcement action for off-channel communications is a behavioral one. It is seldom a lack of rules or policies that causes non-compliance, but an individual’s unwillingness to follow them.

The hardest task is persuading people to change their behavior. They don’t break the rules because they don’t know or understand them.

Carroll Barry-Walsh, Lawyer, Speaker, and Founder at Barry-Walsh Associates

In 2024, 65.2% of respondents have said their biggest concern when ensuring compliance with communication channels is “getting staff to comply.”

This figure has increased by 3.7 percentage points, up from 61.5% in 2023. One year on, the issue of instilling a culture of more compliant behavior not only persists, but is apparently more challenging.

As regulatory scrutiny increases alongside stricter policies within firms, it is interesting to note that human behavior is becoming more of a concern than it was in the year prior. This is especially true given that regulators are at pains not only to take enforcement action against financial organizations, but against the non-compliant individuals within those organizations.

Individuals are increasingly being held to account for their non-compliant actions, yet compliance teams still struggle to get “employee buy-in” with policies and procedures.

This may be because we are understanding employee behavior more, and have more awareness generally because of the ongoing ‘compliant comms’ issue.

This is also a testament to the fact that we all spend huge amounts of time on mobile phones every day.

As the lines between personal and business communication can easily blur, instilling discipline on the basis that compliance may not know if I use my personal mobile to influence business in some way means it is challenging to maintain a complete data set.

Rob Mason, Director of Regulatory Intelligence, Global Relay

Why is it so hard to get staff to comply?

Bluntly: Mixed messages. Companies are asking staff to use a variety of communications channels to respond promptly. Make something easy and quick to use and staff will use it. At the same time, they don't want staff to say dumb things.

How to square this circle? The key message which needs drumming in over and over is that these are work channels for work purposes and that staff must behave professionally. Professionalism is the key – rather than simply compliance with rules.

Act professionally. Speak professionally. Write professionally.

That is what staff need to hear from bosses and need to understand and internalize for themselves.

What does this mean in practice?

Three golden rules:

1. Do you really need to write this down? And in this way? THINK before pressing ‘send.’

2. If your communications are being read, it's because something has gone wrong. So don't write stuff down you're not prepared to defend years later.

3. Non-work comments: if you wouldn't like your mother reading it, don't write or send it.

When employers talk about bringing your ‘whole self’ to work they do not mean your sex life, private fantasies, or personal thoughts about others, no matter how witty or amusing you think you're being. 99% of what is in your head is not worth making public in a professional environment – and probably not anywhere else either.

Bad examples are worth sharing with staff to show them what is on the wrong side of the line.

Carroll Barry-Walsh, Lawyer, Speaker, and Founder at Barry-Walsh Associates

Technical difficulties

Away from issues of human factors in non-compliance, multiple respondents highlighted technological challenges as their current priority. Regulators, especially those in the U.S., have made clear their zero-tolerance approach to firms that fail to preserve business communications. However, while regulatory expectations are clear, technological solutions still appear to cause a degree of uncertainty.

In 2024, the number of respondents that said they have difficulty capturing and storing communication data across all channels has risen by 3.9% to 27%, up from 23.1% in 2023.

Conversely, 23.4% of respondents said that they had difficulty monitoring all communication channels in 2024, which has decreased significantly from 53.8% in 2023.

Communication channels continue to spring up. Front office colleagues like to be able to accommodate their clients and so are keen to chat to them on the channel of communication of the client’s choosing.

The number of these used to be fairly limited, but now this could include a whole deluge of channels, for example, Bloomberg, Refinitiv, Symphony, ICE chat, Teams, Zoom, Slack, CME, Cisco, Skype, and that’s clearly not a full list…

Firms are also thinking about other channels such as social media, for example, LinkedIn, Facebook, Instagram, X (formerly Twitter), YouTube, TikTok, etc.

So immediately you can see there’s a challenge to getting that data into relevant systems so it can be monitored as well as the recordkeeping aspects of all business activities… there seem to be new comms channels popping up all the time!

Technology does provide this capability, but the data Connectors which are the clever pieces of kit that can accommodate all the different channels and data anomalies within those channels and uniformly format and index data and make sense of it safely and securely, is a very specialized discipline.

Strong technology solutions and the flexibility of those solutions are critical to accommodate these and new channels as they inevitably arrive. Testing these too – routine testing or MI to assure completeness to the client.

Rob Mason, Director of Regulatory Intelligence, Global Relay

This all comes down to technology. Technology has improved to make it simpler to monitor or supervise communication. But it is also technological innovation that means there is always a new compliance tool to capture, making that harder simultaneously. Technology is to blame – for both the good and the bad.

Pankaj Anand, Head of Governance Technology Solutions, StoneX

With a constantly changing communication ecosystem, firms are consistently tasked with finding solutions to capture new – or previously unused – communication channels.

As an example, in 2023 an individual was charged with insider trading after sharing inside information on Xbox 360 voice chat. As employees take up new means of communicating, firms will naturally be on the back foot with solutions.

Industry insights

What's your biggest compliance challenge?

“Sifting through the vast amount of ‘noise’ and false positives captured by e-surveillance tools. I would be interested to see how AI can (or has already) play a role in this space.”

Chief Compliance Officer,
Hedge Fund, APAC

“Making the institution understand the real risk involved and addressing the matter properly.”

Senior Monitoring and
Surveillance Analyst,
Broker Dealer, North America

“Any policy only works when people comply – our staff is great about this – all electronic comms are copied into email (and replied to from there) and captured with Global Relay.”

Director of Compliance,
Financial Services, North America

“Ensuring staff knowledge of the policies and consistency in application across the business. Do what we say we are doing?”

Vice President of Compliance,
Asset Manager, Global