The revised Markets in Financial Instruments Directive (MiFID II) came into force in January 2018 to regulate the financial services sector with a new, much stricter set of rules regarding call recording.
The regulation applies more widely than the previous requirements for recording phone calls. Under previous MiFID I regulations, members were allowed discretion as to whether they required firms to record phone calls and electronic communications that resulted or might result in transactions. This recording obligation has become mandatory on firms under MiFID II.
Under the revised MiFID II rules, you must record all conversations that are intended to lead to a transaction or trade, even if they ultimately don't. These rules apply equally to firms dealing with their own account as well as providing services for external clients.
MiFID II also includes those who were previously exempt under MiFID I from having to record, such as financial advisers and brokers: anyone involved in the advice chain that may lead to a trade or investment.
MiFID II also includes the premises in which these calls or conversations take place, and requires that all "communications that are intended to lead to a transaction" be recorded and retained.
Recordings also need to be stored for longer: for a minimum of five years, compared to the six months previously required.
More robust rules around how businesses should record and store their conversations now apply. MiFID II requires that all records be kept in a durable medium that allows them to be replayed or copied but which prevents the original being altered or deleted.
All calls recorded using our Echo product are securely encrypted to ensure compliance with MiFID II regulations.
MiFID II also states that businesses must ensure the quality, accuracy and completeness of these records and that they must be stored in a medium that is accessible and readily available to the FCA on request.
Under MiFID II, businesses also need to review their recordings from time to time to ensure compliance. Our Echo product allows authorized users to download and provide a copies of phone calls in a variety of formats, on request, to the FCA.