In the current digital age, SMS has become a vital communication tool, especially within the financial services sector where the need for timely and secure messaging is paramount. Yet, the regulatory framework that governs SMS communications is both complex and stringent.
According to Theta Lake, the role of SMS, or Short Message Service, has expanded significantly over the years. It has grown from sending simple text messages to include multimedia elements like images, emojis, and videos. This evolution has meant that financial service firms are now using SMS for essential business interactions, not just casual communications.
However, this comes with a catch: regulatory bodies in the U.S., the UK, and Canada have set strict regulations regarding the capture, retention, and supervision of these communications.
Organisations must comply with regulations such as the SEC’s Rule 17a-4, FINRA Rule 2210, and the FCA’s SYSC 10A.1.6. These regulations require firms to retain records of all business-related communications to ensure they are available for compliance reviews and audits. Non-compliance can result in severe penalties, with recent enforcement actions seeing firms fined more than $3bn for failing to maintain and preserve electronic communications.
1Global is a leader in providing global telecom solutions that allow customers to remain connected anytime and anywhere, using any device on a single global network. Their SMS service is available in over 220 countries. For regulated companies and users of this service, capturing, archiving, and surveilling these communications pose significant challenges, particularly for Heads of Unified Communications and Compliance IT.
Theta Lake has seamlessly integrated with 1Global to capture SMS communications in their original format, whether for all users or only those regulated. These are then archived either in the customer’s existing archiving systems or within Theta Lake’s SEC-17a-4 compliant environment. This integration enables Theta Lake customers to search, review, and manage communications effectively to mitigate risks.
Consider a financial firm where both regulated and non-regulated employees need to discuss business matters. Through the integration of 1Global and Theta Lake, SMS communications from all employees are captured and archived, ensuring that no critical information is overlooked. This is especially crucial for firms with a mixed user base, where some employees are under regulatory scrutiny while others are not.
For instance, if board members use SMS to discuss sensitive financial issues, capturing these communications is essential for compliance. Similarly, if traders are communicating about market transactions via SMS, every message needs to be captured and supervised to adhere to regulatory standards.
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