Traders Working From Home Must Record Calls, Says FCA

By Lucia Osborne-Crowley
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Law360, London (January 11, 2021, 11:41 AM GMT) -- The finance watchdog has told traders and bankers they must start recording all activities including voice calls in their remote working set-up as the COVID-19 lockdown drags on and working from home looks set to continue for the foreseeable future.

Financial services companies are being told by the FCA to ensure that all communications are recorded in working-from-home environments. (iStock)

The Financial Conduct Authority said on Friday that all finance firms must ensure that all communications are recorded in their working-from-home environments to help protect the industry against market abuse.

"At the start of the pandemic, if your firm moved to an alternative site or a working from home arrangement we asked you to consider the broader control environment in view of the new circumstances," the watchdog said. "Given the extensive duration of these arrangements, we now expect you to record all relevant communications, including voice calls, when working outside the office."

The FCA added that banks should continue to take "all steps" to prevent market abuse risks, including conducting retrospective reviews of the months since the pandemic began. The regulator said it will also continue to look out for potential market abuse and will take enforcement action where necessary.

The watchdog also said that finance firms must submit any required regulatory data without delay.

Most Britons have been working at home since March, when Prime Minister Boris Johnson announced a U.K.-wide lockdown in response to the coronavirus pandemic.

The FCA warned in October that the risk that inside information can end up in the wrong hands has been heightened with workers shifting to home offices during the COVID-19 crisis. Julia Hoggett, director of market oversight at the City watchdog, said that the lack of separation between work and home life means that staff who have access to inside information must be more cautious.

The watchdog put out another warning in May, saying that increased capital-raising activity and alternative working arrangements prompted by the COVID-19 outbreak could increase the risk of market abuse. The watchdog told companies to be vigilant about potential leaks and rumors.

The FCA also told companies listed on the London Stock Exchange in the same month not to unreasonably delay making updates to the market on their performance so that investors are not misled. The watchdog added that the pandemic could have altered the information that is material to the prospects of a business.

The updated guidance reiterating the need to comply with regulations comes after the FCA had initially allowed some leeway at the beginning of the COVID-19 pandemic. The measures included extending deadlines for financial results and postponing plans that are not critical to protecting consumers.

--Additional reporting by Najiyya Budaly and Richard Crump. Editing by Ed Harris.

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