The clock is ticking, the countdown has started
and time is running out - 1 March 2009
It changes Spring 2009, is your telephone call recording
equipment compliant ?
The Financial Services Authority (FSA) published new
rules requiring firms to record telephone call conversations
and other electronic communications to help deter and
detect market abuse in the UK.
From March 2009, firms will have to record all telephone
conversations and electronic communications including
facsimile recording relating to client orders and the
conclusion of transactions in the equity, bond, and
derivatives markets.
Select Service are pleased to inform you that we
now have a Guaranteed high end quality range of Cost
Effective and Affordable recording equipment and systems
for organisations of all sizes with various requirements
and budgets as a solution to the demands of the FSA
telephone call recording legislation. see our
Vidicode Telephone Call Recorders and the
Retell Phone Call Recorders
The FSA consulted on the telephone call recording rules
last year. In response to the comments received, the
FSA conducted a further review of the cost-benefit analysis
and discussed with the industry the scope and practicalities
of the new rules.
The original proposals changed significantly following
this work. The retention period for recorded telephone
calls and communications has been reduced from 3 years
to 6 months. Mobile phone call conversations have been
exempted from the taping rules but this will be reviewed
in 18 months time. In addition, discretionary investment
managers will not be required to record telephone conversations
and electronic communications with firms that are subject
to the taping rules.
See below for the telephone call recording amendments
to the FSA Conduct of Business sourcebook (COBS)
Businesses across the UK are being reminded they will
have to be ready for the March 2009 deadline. From that
date the Financial Services Authority (FSA) will require
any company involved in receiving client orders and
negotiating, agreeing, and arranging financial transactions
to record all phone conversations and electronic communications.
| We offer the full range of
both Retell Call Recorders and the Vidicode
telephone call recorders These include single
line call recorders, multi line recorders ,
Fax recorders, Digital Call Recorders and USB
call recorders. |
FSA Document
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The following details are from the FSA website
Full details can be found at
Telephone Recording: recording of voice conversations
and electronic communications
Amendments to the FSA Conduct of Business sourcebook
(COBS)
Insert the following new section after COBS 11.7.
11.8
Recording telephone conversations and electronic communications
Application - Who?
11.8.1 R
This section applies to a firm:
(1) which carries out any of the following activities:
(a) receiving client orders;
(b) executing client orders;
(c) arranging for client orders to be executed;
(d) carrying out transactions on behalf of the firm,
or another person in the firm's group, and which are
part of the firm’s trading activities or the trading
activities of another person in the firm’s group;
(e) executing orders that result from decisions by the
firm to deal on behalf of its client;
(f) placing orders with other entities for execution
that result from decisions by the firm to deal on behalf
of its client;
(2) to the extent that the activities referred to in
(1) relate to:
(a) qualifying investments admitted to trading on a
prescribed market;
(b) qualifying investments in respect of which a request
for admission to trading on such a market has been made;
(c) investments which are related investments in relation
to such qualifying investments.
11.8.2 R
This section does not apply to the carrying on of the
following activities:
(1) activities carried on between operators, or between
operators and depositories, of the same collective investment
scheme (when acting
in that capacity);
(2) corporate finance business;
(3) corporate treasury functions.
11.8.3 R
This section does not apply to the following firms or
persons:
(1) a service company;
(2) a non-directive friendly society;
(3) a non-directive insurer;
(4) a UCITS qualifier.
Application - Where?
11.8.4 R
This section applies only with respect to a firm's activities
carried on from an establishment maintained by the firm
in the United Kingdom.
Recording telephone conversations, etc
11.8.5 R
A firm must take reasonable steps to record relevant
telephone conversations, and keep a copy of relevant
electronic communications, made with, sent from or received
on equipment:
(1) provided by the firm to an employee or contractor;
or
(2) the use of which by an employee or contractor has
been sanctioned or permitted by the firm;
to enable that employee or contractor to carry out any
of the activities referred to in COBS 11.8.1R.
11.8.6 R
The obligation in COBS 11.8.5R does not apply to:
(1) telephone conversations and electronic communications
(except emails) made with, sent from or received on
a mobile telephone or other mobile handheld electronic
communication device; or
(2) a discretionary investment manager, in respect of
telephone conversations or electronic communications
made with, sent to or received from a firm which the
discretionary investment manager reasonably believes
is subject to the recording obligation in COBS 11.8.5R
in respect of that conversation or communication; or
(3) a discretionary investment manager, in respect of
telephone conversations or electronic communications
made with, sent to or received from a person who is
not subject to the recording obligation in COBS 11.8.5R,
provided that such telephone conversations or electronic
communications are made with, sent to or received from
such persons on an infrequent basis, and represent a
small proportion of the total telephone conversations
and electronic communications made, sent or received
by the discretionary investment manager to which COBS
11.8.5R apply.
11.8.7 G
Electronic communications includes communications made
by way of facsimile, email and instant messaging devices.
11.8.8 R
For the purposes of COBS 11.8.5R, a relevant conversation
or communication is any one of the following:
(1) a conversation or communication between an employee
or contractor of the firm with a client, or when acting
on behalf of a client, with another person, which concludes
an agreement by the firm to carry out the activities
referred to in COBS 11.8.1R as principal or as agent;
(2) a conversation or communication between an employee
or contractor of the firm with a professional client
or an eligible counterparty, or when acting on behalf
of a professional client or an eligible counterparty,
with another person, which is carried on with a view
to the conclusion of an agreement referred to in (1)
above, and whether or not it is part of the same conversation
or communication as in (1).
11.8.9 G
(1) COBS 11.8.8R(2) includes conversations and communications
relating to specific transactions which are intended
to lead to the conclusion of an agreement by the firm
to deal with or on behalf of the client as principal
or agent, even if those conversations or communications
do not lead to the conclusion of such an agreement.
It does not include conversations or communications
which are not intended to lead to the conclusion of
such an agreement, such as general conversations or
communications about market conditions.
(2) The FSA would not usually expect the obligation
in COBS 11.8.5R to include conversations or communications
made by investment analysts, retail financial advisers,
and persons carrying on back office functions, as such
persons will not normally make relevant conversations
or communications when acting in those capacities.
Retention of records
11.8.10 R
A firm must take reasonable steps to retain all records
made by it under COBS 11.8.5R:
(1) for a period of at least 6 months from the date
the record was created;
(2) in a medium that allows the storage of the information
in a way accessible for future reference by the FSA,
and so that the following conditions are met:
(a) the FSA must be able to access the records readily;
(b) it must be possible for any corrections or other
amendments, and the contents of the records prior to
such corrections and 6 amendments, to be easily ascertained;
(c) it must not be possible for the records to be otherwise
manipulated or altered.
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