Firms get the message about off-channel communications (IGNITES)

It appears the regulators have the attention of investment advisers when it comes to their employees use of off-channel communications. Dozens of SEC enforcement actions, among other regulatory activity, have created an urgency at these firms to implement advanced monitoring technology systems and training programs to contain the expansive communication options now available. Amy Lynch, FrontLine’s Founder and President, explains that many large and mid-size advisers and funds have added applications that capture employee texts, WhatsApp, Slack and other chat options on company administered devices. Where price points of these systems are unattainable, she adds, smaller firms are updating policies by prohibiting the use of off-channel communications for business and routinely conducting employee training. A major emphasis during its more recent examinations, the SEC continues to review firms for books and records violations as it pertains to the off-channel communications by their employees. See IGNITES (subscription required), “Firms Step Up Oversight of Off-Channel Communications”