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MiFID II Recording Compliance

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 around call recording.

Under the original MiFID I regulations, members were allowed discretion as to whether they required firms to record telephone calls and electronic communications that resulted or might result in transactions. This recording obligation became mandatory on firms under MiFID II.

To comply with the revised MiFID II you need to 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. It also includes those who were previously exempt under MiFID I from having to record such as financial advisors and brokers – anyone involved in the advice chain that may lead to a trade or investment.

MiFID II also includes 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 will also need to be stored for longer – for a minimum of five years against the six months that were required by MiFID I.

More robust rules around how businesses should record and store their conversations were introduced. MiFID II requires 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 Tri-Line’s Echo are securely encrypted using 256-bit AES symmetric key algorithm to ensure compliance with MiFID II regulations.

MiFID II also states that businesses must ensure the quality, accuracy and completeness of these records, and they must be stored in a medium that is accessible and readily available to the FCA on request. Under MiFID II businesses will also need to review their recordings from time to time to ensure compliance. Tri-Line’s Echo call recording allows authorised users to download and provide a copy of any call in .wav, .mp3, or .ogg format to the FCA on request.

For more information visit the FCA Call recording information page here.