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Employee Conflicts of Interest Ethics & Culture MNPI & Enterprise Conflicts

3 Things On The Minds Of Compliance Officers Right Now

Flat-sharing. Personal e-comms. Maintaining a culture of compliance. Star’s CTO offers up his insights on these challenges based on recent conversations with some close financial services and compliance contacts 

Here at StarCompliance, we have lots of conversations everyday with lots of people in financial services. It’s our job to know what’s going on in the day-to-day world of financial compliance so we can craft our software solutions and services to help compliance do its job better. Today’s StarBlog offers a selection of these conversations—sharing three situations compliance professionals are currently concerned about—with emphasis placed on recent conversations conducted by David Rowland, Chief Technology Officer at Star.  

Just when you thought it was safe to go back in the office … it’s not. More than two years in from the start of the pandemic—with numerous return-to-office dates having come and gone, and numerous CEOs of big banks stating defiantly they expect their people to show up at their desks every day—remote work in the financial sector and beyond continues. And with each passing week and month, as firms get better at handling the practices and processes that go along with remote work, and as more and more new and existing members of the workforce come to expect at least a hybrid-work option moving forward, it’s arguable that some form of working from home is here to stay. 

Where, then, does this leave compliance officers moving forward? Worried, in a word, in one case at least about flat-sharing. David Rowland: “I was speaking to someone at a big UK exchange, who shared the common but still critical concern that a lot of the younger generation are flat-sharing. There could be three of them living in a single apartment. One of them might be in the dining room, one of them might be in the kitchen, and one of them might be in a bedroom. And one may walk through the dining room to get to the kitchen to get a cup of tea, and before you know it she’s seen what’s on two people’s screens that she probably shouldn’t have. Could something similar happen in the office? Yes, particularly in an open-plan office stuffed with cubicles. But compliance still has more control there, in terms of who sits where and who can potentially see or overhear what. And there’s still a lot to be said for a live, in-person compliance officer making the rounds—seeing what there is to see and also just being seen by employees.” 

Continuing on the subject of remote work, in addition to the compliance hazards associated with flat-sharing there are the related hazards of people working without physical supervision in the age of manifold personal communications options. Email. Text. Messaging apps of all kinds and capabilities, including the capability to automatically destroy messages once they’re read or after a defined period of time. And finally, there’s that very old-fashioned practice of actually talking to someone on your mobile phone. But compliance officers want to know, need to know, who exactly are firm employees talking to? What are they texting so intently about? Are they calling their broker to make a trade based on MNPI, or just making plans to meet a friend for a drink? 

David Rowland: “This is a hard one. In an office, especially an open-plan one with compliance sitting on the floor, if an employee is walking around talking on his personal mobile all the time, chances are compliance is going to eventually say something. But you’re never going to be able to stop people What’sApp-ing their friends. I spoke to someone recently about a bank looking into, or at least considering, how to gain access to or monitor their employees’ personal mobile phones. My take is, that’s a breach of privacy, one that likely wouldn’t stand the test of time. If you’re that concerned about who’s communicating with whom about what, you’ve got to just issue corporate phones and say, ‘use this phone for any work related business and oh, by the way, we’re monitoring it.’ In the end, if a person is determined enough to get around the system, that person will. Compliance has never monitored anyone from home before, it’s just that now employees may also be doing their jobs from home.” 

A concern for compliance officers in the most normal of times, maintaining a culture of compliance in a time of plague—with most if not all of your employees working remotely—has become an even greater concern. How do you keep up a strong culture of compliance with no in-person interaction or training? Without seeing the compliance officer walking the aisles, visually establishing her authority like a beat cop? Now throw into the mix the fact there are people who work for firms who have never, ever been in the office. 

David Rowland: “A friend works for a big UK bank. She doesn’t need an ID card because she’s never been to the office. She’s probably flicked through some compliance training videos, but it’s not the same as someone doing the rounds at team meetings, making sure everyone is familiar with high-level compliance requirements. Anyone who’s been hired in the last two years may never have been in the office. There are probably thousands in this cohort scattered across financial services. And the longer the coronavirus stays a factor in how firms think about work, the more that number will increase.” 

There’s no one solution to any of these challenges, but technology might be a more comprehensive one than you think. Technology in the form of Zoom calls has been a big part of keeping scattered workforces connected. Technology in the form of automated compliance software—that allows for greater efficiencies, centralized monitoring, better reporting, easier investigations, and safer audits—is keeping compliance connected to firm activity and employees connected to compliance, whether they’re at their office desks or their kitchen tables.