As compliance budgets continue to tighten, industry professionals need to look for ways to streamline processes and optimize resources across technology stacks, according to Audrey Costabile, senior analyst in the Market Structure and Technology team at Coalition Greenwich.
“To do this, an end-to-end compliance solution is key,” she wrote in a blog “Digital Communications Storage Is Finally Moving to the Next Level”.
In the case of digital communications, end users have traditionally sent communications data into archiving systems and left it there untouched, she said.
“However, as regulatory requirements tighten for banks and other firms, and regulators are cracking down with massive recordkeeping fines, archiving solutions need to do more than just “set it and forget it,” she said.
According to Costabile, the use of digital communications archiving solutions is nothing new and financial services firms have always needed to retain data to remain compliant.
However, this need has grown substantially in recent years, as regulated users began working remotely in 2020 and continue to work on a hybrid schedule today, she noted.
Costabile said that providers of data archiving solutions have long focused on retention.
Years ago, this was the right approach, as institutions just needed to hold on to information for a certain number of years, she said.
However, today’s compliance standards require firms to also be able to pull insights from this data to understand more about employee behavior, conduct risks and so on. Firms that implement data archiving solutions that can extract insights from stored data have a competitive advantage over firms with legacy systems, she added.
“Today’s technology should satisfy as many compliance gaps as possible,” Costabile stressed.
For instance, financial services firms with regulated users should be able to safely store and access a variety of enterprise data, including electronic communications, voice, video, chat, and more, she said.
“As legacy technology was not designed to store data coming from multiple communication sources, the information in these systems tends to be siloed, fragmented and difficult to access,” she added.
Costabile further said that cost efficiency—or lack thereof—is another piece of this story.
As more communications channels are added, the number of solutions has ticked higher in tandem, increasing costs, she said.
Legacy storage architecture drives up expenses due to inefficiency, compared to modern technology like the cloud, Costabile said.
“Firms have an opportunity to bring all their data together in a cloud storage technology that can lower costs by as much as 20%, resulting in millions of dollars in savings for global banks,” she noted.
Given the emergence of modern communication channels, firms should look to implement solutions that go beyond simple archiving, according to Costabile.
Next-generation digital archiving solutions should be able to not only securely store communications data in one system, but also to surveil that data, providing automated monitoring and seamless data search and extraction—saving time and improving efficiency, she explained.
Costabile said that compliance heads should look to a technology vendor that can capture all communications data from every traditional and emerging communication channel, archive that data in one solution, and be able to perform advanced surveillance on that data to spot conduct risks.
“Investing in technology that ensures data can be recorded, archived and surveilled in one solution will enable firms to lower costs, streamline processes and avoid regulatory risks,” she concluded.
