Co-author: Matt Lehman, Industry Principal, Financial Services, RingCentral

In the ever-evolving landscape of regulatory compliance and security, organizations are facing increasing scrutiny from regulators to ensure the proper preservation and monitoring of electronic communications. The Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) have not hesitated to impose substantial fines on firms that fail to maintain and preserve electronic communications (phone/voice, text, video, email, etc.) in compliance with record-keeping provisions. Recent penalties have underscored the critical importance of robust communication monitoring and archiving systems.

Regulatory crackdown on compliance failures

The financial services industry has recently witnessed a wave of fines imposed by regulatory bodies for failures related to communication compliance, with a distinct focus on banks and investment firms.

The SEC and CFTC have combined forces to penalize firms for ‘widespread and longstanding failures’ to capture and preserve electronic communications properly. These penalties highlight that regulatory patience has run out, and firms are now expected to take proactive steps to ensure compliance with record-keeping and supervision requirements.

The SEC has already ordered penalties exceeding $1.5 billion for violations of record-keeping provisions, while the CFTC has imposed over $1.09 billion in civil monetary penalties since December 2021. The cumulative fines for off-channel communications now stand at an astounding $2.5 billion+. 

The message is clear: regulatory expectations are higher than ever, and firms must take immediate action to address compliance deficiencies.

The importance of proactive compliance measures

The regulatory landscape necessitates a fundamental shift in how firms approach communication compliance. Proactive self-reporting and remediation have proven to be effective strategies in mitigating penalties. Recent cases have shown that firms that self-report off-channel communications and take swift corrective actions to ensure compliance are rewarded with substantially reduced fines.

For instance, a firm that self-reported off-channel communications before regulatory intervention managed to reduce its penalties significantly. This proactive approach included clarifying relevant policies, enhancing training, reinforcing communication channel requirements, and implementing advanced surveillance platforms that covered all communication channels. Such actions demonstrate a commitment to compliance and a willingness to rectify any shortcomings.

Cloud-enabled unified communications can simplify compliance

Companies don’t need to give up ease and convenience for security and compliance. But compliance can be difficult to implement, particularly when you consider that the same retention and supervision requirements that apply to text-based communications, such as emails, apply to all forms of electronic communications, including audio, video, SMS/texting, and messaging.

The problem with ensuring compliance stems from the proliferation of digital channels coupled with the customer’s expectation of being able to use the communication tools and apps they want and are most comfortable using. Additionally, new modes of communication—including fragmented and multiple duplicative systems offering messaging, voice, and video connections—have made the job difficult for compliance teams to monitor and track all of their employees’ communications, or the tools available on the older on-premises platforms were not easy to use.

Fortunately, there is a solution. By using a cloud-based unified communications platform, not only will all forms of communication be captured and archived, but layering artificial intelligence (AI) and machine learning will enable and automate detection for compliance risk. In the case of a regulatory request, any relevant content or data can be surfaced to compliance teams and shared with government regulators and auditors.

An AI-enabled and cloud-based unified communications platform, accompanied by a robust risk and compliance platform, can give regulated firms the tools, access points, and economies of scale to efficiently feed multiple systems for surveillance, compliance, audit, and proprietary analysis while enabling the communications modes (messaging including SMS, video, phone) that empower employees to work effectively.

The power of the RingCentral and Theta Lake partnership

In this era of heightened regulatory scrutiny, organizations need powerful tools to ensure compliance and security without hindering their operations. RingCentral, a leader in Unified Communications as a Service (UCaaS), recognizes the pressing need for secure and compliant communication solutions.

To address these challenges head-on, RingCentral has expanded its partnership with Theta Lake, a Compliance & Security platform that specializes in revolutionizing communication management and monitoring.

Theta Lake brings its expertise in advanced compliance and security technology, seamlessly integrated into RingCentral’s unified communication suite. This partnership provides enterprises with a comprehensive suite of tools for communication capture, archiving, eDiscovery, legal hold, and surveillance for various communication formats, including voice, video, chat, messaging, and documents. This integrated approach streamlines compliance monitoring, ensuring that businesses can operate confidently while adhering to regulatory obligations.

Key benefits of an integrated RingCentral and Theta Lake solution:

1. Risk mitigation: The partnership enables businesses to leverage RingCentral’s communication services while minimizing compliance risks. Theta Lake’s advanced risk detection and analysis capabilities empower organizations to maintain control over potential threats.
   
   
2. Time and cost savings: Theta Lake’s API-based integrations facilitate rapid deployment, allowing firms to be compliant while rolling out their RingCentral suite quickly. Flexible archive storage options further enhance the efficiency of compliance efforts.
   
   
3. Secure collaboration: In a hybrid work environment, the ability to collaborate seamlessly while adhering to regulatory requirements is paramount. RingCentral and Theta Lake ensure that users can collaborate confidently without compromising compliance.
   
   

Harness the power of a comprehensive solution for compliance and security

The integrated solution provided by RingCentral and Theta Lake offers a holistic approach to compliance and security. With the most certified compliance integrations with RingCentral, Theta Lake ensures a harmonious working relationship between the components of the solution. This unified approach instills confidence in end-users, knowing that their communications are secure, compliant, and fully supported.

As organizations navigate the challenges of a digital world with ever-evolving regulations, the RingCentral and Theta Lake partnership provides a robust UCaaS Suite that drives growth, collaboration, and regulatory compliance across diverse industries. Together, we empower businesses to communicate securely, efficiently, and with the confidence that their communications meet the highest standards of compliance.

Embrace the power of secure and compliant communications today with RingCentral and Theta Lake. Your journey to success begins with a partnership that understands and addresses the complexities of modern regulatory landscapes.

Originally published Sep 19 2023 by RingCentral Blog