ACA's John Jacobs recently contributed an article outlining how communication surveillance can strengthen a compliance program. The article was featured in the December 2018 edition of the Compliance & Ethics professional publication. Below is an excerpt form the article.
As Benjamin Franklin famously advised, “An ounce of prevention is worth a pound of cure.” Proactive and thoughtful surveillance of employees’ electronic communications is an effective compliance and risk management practice that can prevent potential problems. Yet, as employees’ online behavior continues to pose serious compliance and reputational risks, and as eDiscovery costs resulting from misconduct skyrocket, many companies outside of the financial industry have not yet implemented this “ounce of prevention” that is effective to curtail unethical and damaging behavior.
Surveillance in the financial industry
Focused, risk-based surveillance of employees’ electronic communications has become a standard practice in the financial industry. Surveillance of emails, chats, instant messages, and other electronic communications is not required by laws or regulations, but nevertheless has been implemented by investment advisers, investment companies, and broker-dealers. It’s no longer merely a “best practice,” but has become a standard practice to help prevent the dissemination of material nonpublic information and safeguard against other regulatory compliance violations.