7 ms·

Are US bank employees prohibited from discussing financial matters using anything but official channels (email, paper?) per se OR is this about using other chan

Are US bank employees prohibited from discussing financial matters using anything but official channels (email, paper?) per se OR is this about using other channels and failing to preserve records of the conversations?

polygamous_bat 3y ago
AFAIK you are allowed to use any channel as long as you preserve records of the conversation. However, meeting the standards for preservation is quite difficult, which is why employees of financial institutions are generally told not to communicate outside person-to-person, or channels vetted by their company (and lawyers thereof).
- pipo234 3y ago
  Thanks! That makes a lot of sense.
- SilasX 3y ago
  So ... you aren't obligated to preserve records of the conversation if the channel is "in person", then.
  - deleted 3y ago
    [deleted]
  - TimTheTinker 3y ago
    Right - or if it's over the phone.
    - xhkkffbf 3y ago
      What if I dictate into my phone and What's App sends it as text? Purely to save bandwidth of course.
      - pasc1878 3y ago
        That is one of the things that the banks are being fined for.
    - freetanga 3y ago
      I um unsure about current status in the States, but in Europe all conversations with a client over the phone where you might discuss commercial terms need to be recorded. Banks just cover their backs, and for customer facing positions all phone calls, no matter if through landlines (or IP telephony) or cell are recorded, either by the PBX software or by the carrier. Employees are reminded not to use these lines for personal reasons (imagine an employee using the phone line to discuss their health with their doctor, and the employer just recorded extremely sensitive information from an employee), but the alternative means a strong fine from the regulators (usually the local AML authority).
  - freetanga 3y ago
    Mostly not. But many interactions such as a Risk and Audit Committee are required to have minutes and signed by all participants. This is usually for all sessions which shape and oversee key policies such as Risk, AML, Audit, etc…
- Sunspark 3y ago
  Such a waste of time trying intently to regulate and control communication. People will just get a second private device that is not managed by the organization, and if there is a mutually beneficial advantage to doing so, the other party will do the same as well. This has been going on forever, I remember when they kicked up a huge fuss when they found out that people were doing direct pin-to-pin messages on the blackberry (was not logged for boss to read at the time).
  - fidotron 3y ago
    Isn't this an argument that doing anything that is illegal but beneficial to the conspirators should be left alone? If it were totally allowed and widespread how would there be any pretence of fairness in the markets? Of course you could say that at least then people would be appreciating the reality of the situation . . .
  - edmundsauto 3y ago
    It’s actually a bit of a trap - if you are caught using secondary devices, it speaks to intent. Similarly, when you deposit money at a bank and they ask you to certify these are not proceeds of a crime: they aren’t expecting to catch people at that step. But if they catch you later, boom you defrauded a bank by lying and have additional charges.
    - ghostpepper 3y ago
      How is this different from having laws on the books that ensure all citizens are breaking the law at any given time? Doesn't feel like how laws are meant to be used
      - edmundsauto 3y ago
        Because it applies to certain regulated industries and people who work in those industries. It’s not wide ranging.
    - Sunspark 3y ago
      It's not illegal to own a personal device, it's also not illegal to be friends with your coworkers if you trust them. There is no "intent" here. What you are describing is an organized criminal conspiracy which is illegal no matter what device or system you're using. What I am talking about here is whether the employer should get to listen in to all your calls and read all your emails and text messages. Why do you think they like BYOD so much? Because they can get a window into your personal life, what apps you have installed, etc.
- veave 3y ago
  It's a bit weird that even though they can communicate person-to-person, where records won't be kept, they are supposed to keep records of electronic communication.
  - joosters 3y ago
    Not really. How on earth could that ever be implemented?
    - loeg 3y ago
      In person conversations could be required to be recorded with a portable voice recording device (like a tape deck or phone). Same for phone calls. The regulatory authorities exempt those communications for now, but it isn't clear that there is any kind of consistent standard / reasoning.
  - polygamous_bat 3y ago
    Well, it's incredibly hard to scale fraud only through person-to-person communications. It's not impossible, but think about the scale that online communication would allow.
    - misja111 3y ago
      This has nothing to do with scaling. How do you picture that, some employee would broadcast sensitive information to a WhatsApp group, in order to reach as many others as possible at once? The offense here is that no effort was done to keep records of the communication. It would have been ok to use WhatsApp if they somehow would have archived all communications. Records of communications have to be kept so that auditors can verify that no inside trading secrets were communicated to others, for instance.
    - bonestamp2 3y ago
      Now I understand why some of the banks wanted people back in the office as soon as possible. Trying to support their commercial real estate bags is likely another.
- dundarious 3y ago
  Also, compliance teams want live or near-live access, and do run dynamic filters on that live content. I can’t imagine a non-criminal* compliance team accepting a solution that is T+1 or that depends on manual action from the employee. * I’m barely using hyperbole
ikue 3y ago
It is a record keeping issue from what they discussed and the same thing was said in an article at ComputerWorld. https://www.computerworld.com/article/3668574/banks-face-a-whatsapp-reckoning-as-regulators-clamp-down-on-messaging-apps.html https://www.computerworld.com/article/3668574/banks-face-a-w...
loeg 3y ago
So the law as written regards keeping records of inter-office memoranda, but the regulators have cheerfully expanded the scope of this to include essentially all communication by bank employees (except maybe phone calls).
- Sunspark 3y ago
  No, it includes calls now. Traditional calls over copper telephone lines are not recorded, but digital calls over MS Teams or whatever are recorded and kept for review. You still need a secondary device if you want to have a private conversation.
  - pasc1878 3y ago
    No for bank traders all phone calls are recorded and have been done since at least the 1990s
whycome 3y ago
We're in a time where these tools have replaced face to face conversations -- and those previous conversations never required record keeping.
ajross 3y ago
No, that's just what the outrageous clickbait headline[1] fooled you into thinking. The banks aren't being fined for using Signal or WhatsApp or any particular technology, they're being fined for failing to keep records of regulated communication they're required by law to present for auditing. Obviously if you use tools that don't keep records, you need to find a way to save it yourself. [1] Bad in the CNBC original, but actually truncated here on HN to remove the explanatory clause. The original reads "Banks hit with $549 million in fines for use of Signal, WhatsApp to evade regulators’ reach"

polygamous_bat 3y ago

AFAIK you are allowed to use any channel as long as you preserve records of the conversation. However, meeting the standards for preservation is quite difficult, which is why employees of financial institutions are generally told not to communicate outside person-to-person, or channels vetted by their company (and lawyers thereof).

pipo234 3y ago
Thanks! That makes a lot of sense.
SilasX 3y ago
So ... you aren't obligated to preserve records of the conversation if the channel is "in person", then.
- deleted 3y ago
  [deleted]
- TimTheTinker 3y ago
  Right - or if it's over the phone.
  - xhkkffbf 3y ago
    What if I dictate into my phone and What's App sends it as text? Purely to save bandwidth of course.
    - pasc1878 3y ago
      That is one of the things that the banks are being fined for.
  - freetanga 3y ago
    I um unsure about current status in the States, but in Europe all conversations with a client over the phone where you might discuss commercial terms need to be recorded. Banks just cover their backs, and for customer facing positions all phone calls, no matter if through landlines (or IP telephony) or cell are recorded, either by the PBX software or by the carrier. Employees are reminded not to use these lines for personal reasons (imagine an employee using the phone line to discuss their health with their doctor, and the employer just recorded extremely sensitive information from an employee), but the alternative means a strong fine from the regulators (usually the local AML authority).
- freetanga 3y ago
  Mostly not. But many interactions such as a Risk and Audit Committee are required to have minutes and signed by all participants. This is usually for all sessions which shape and oversee key policies such as Risk, AML, Audit, etc…
Sunspark 3y ago
Such a waste of time trying intently to regulate and control communication. People will just get a second private device that is not managed by the organization, and if there is a mutually beneficial advantage to doing so, the other party will do the same as well. This has been going on forever, I remember when they kicked up a huge fuss when they found out that people were doing direct pin-to-pin messages on the blackberry (was not logged for boss to read at the time).
- fidotron 3y ago
  Isn't this an argument that doing anything that is illegal but beneficial to the conspirators should be left alone? If it were totally allowed and widespread how would there be any pretence of fairness in the markets? Of course you could say that at least then people would be appreciating the reality of the situation . . .
- edmundsauto 3y ago
  It’s actually a bit of a trap - if you are caught using secondary devices, it speaks to intent. Similarly, when you deposit money at a bank and they ask you to certify these are not proceeds of a crime: they aren’t expecting to catch people at that step. But if they catch you later, boom you defrauded a bank by lying and have additional charges.
  - ghostpepper 3y ago
    How is this different from having laws on the books that ensure all citizens are breaking the law at any given time? Doesn't feel like how laws are meant to be used
    - edmundsauto 3y ago
      Because it applies to certain regulated industries and people who work in those industries. It’s not wide ranging.
  - Sunspark 3y ago
    It's not illegal to own a personal device, it's also not illegal to be friends with your coworkers if you trust them. There is no "intent" here. What you are describing is an organized criminal conspiracy which is illegal no matter what device or system you're using. What I am talking about here is whether the employer should get to listen in to all your calls and read all your emails and text messages. Why do you think they like BYOD so much? Because they can get a window into your personal life, what apps you have installed, etc.
veave 3y ago
It's a bit weird that even though they can communicate person-to-person, where records won't be kept, they are supposed to keep records of electronic communication.
- joosters 3y ago
  Not really. How on earth could that ever be implemented?
  - loeg 3y ago
    In person conversations could be required to be recorded with a portable voice recording device (like a tape deck or phone). Same for phone calls. The regulatory authorities exempt those communications for now, but it isn't clear that there is any kind of consistent standard / reasoning.
- polygamous_bat 3y ago
  Well, it's incredibly hard to scale fraud only through person-to-person communications. It's not impossible, but think about the scale that online communication would allow.
  - misja111 3y ago
    This has nothing to do with scaling. How do you picture that, some employee would broadcast sensitive information to a WhatsApp group, in order to reach as many others as possible at once? The offense here is that no effort was done to keep records of the communication. It would have been ok to use WhatsApp if they somehow would have archived all communications. Records of communications have to be kept so that auditors can verify that no inside trading secrets were communicated to others, for instance.
  - bonestamp2 3y ago
    Now I understand why some of the banks wanted people back in the office as soon as possible. Trying to support their commercial real estate bags is likely another.
dundarious 3y ago
Also, compliance teams want live or near-live access, and do run dynamic filters on that live content. I can’t imagine a non-criminal* compliance team accepting a solution that is T+1 or that depends on manual action from the employee. * I’m barely using hyperbole

ikue 3y ago

It is a record keeping issue from what they discussed and the same thing was said in an article at ComputerWorld. https://www.computerworld.com/article/3668574/banks-face-a-whatsapp-reckoning-as-regulators-clamp-down-on-messaging-apps.html https://www.computerworld.com/article/3668574/banks-face-a-w...

loeg 3y ago

So the law as written regards keeping records of inter-office memoranda, but the regulators have cheerfully expanded the scope of this to include essentially all communication by bank employees (except maybe phone calls).

Sunspark 3y ago
No, it includes calls now. Traditional calls over copper telephone lines are not recorded, but digital calls over MS Teams or whatever are recorded and kept for review. You still need a secondary device if you want to have a private conversation.
- pasc1878 3y ago
  No for bank traders all phone calls are recorded and have been done since at least the 1990s

whycome 3y ago

We're in a time where these tools have replaced face to face conversations -- and those previous conversations never required record keeping.

ajross 3y ago

No, that's just what the outrageous clickbait headline[1] fooled you into thinking. The banks aren't being fined for using Signal or WhatsApp or any particular technology, they're being fined for failing to keep records of regulated communication they're required by law to present for auditing. Obviously if you use tools that don't keep records, you need to find a way to save it yourself. [1] Bad in the CNBC original, but actually truncated here on HN to remove the explanatory clause. The original reads "Banks hit with $549 million in fines for use of Signal, WhatsApp to evade regulators’ reach"