This works both ways; it is also easier and more efficient for employees to communicate through tools that they are familiar with using in their day-to-day life than one provided by their employer.
Remote channels
The disruption of the Covid-19 pandemic led to far greater reliance on messaging apps, as physical proximity, even with colleagues, was prohibited. In 2019, 68.1mn US mobile phone users accessed WhatsApp to communicate. This figure is projected to grow to 85.8mn users in 2023.
A by-product of this reliance on new digital channels was an escalation in the number of workers using personal phones or tablets for business, as lines began to blur and professional and personal lives intertwined.
Banning employees from using particular channels does not necessarily mean that all risks are eliminated.
Employees are more likely to act casually when working remotely, whether that means taking longer breaks or messaging clients or colleagues through an unauthorised channel.
Having allowed these communication habits to set in over a sustained period, they are now very difficult to shift back to a pre-Covid level, given the inherent convenience and usability that employees have become accustomed to.
Paying the bill
JP Morgan’s $200mn fine in December 2021 was the first significant penalty in a probe that has also impacted the aforementioned dozen leading investment banks to the tune of $1.8bn. The SEC’s crackdown has since continued to expand, as Wall Street’s private equity giants have revealed that they are under investigation.
The enforcement unit has also launched enquiries about smaller registered investment adviser (RIA) protocols for ‘off-channel’ business communications.
The situation leaves business leaders and compliance teams in a quandary.
RIAs are subject to the same regulations as the larger firms that were previously penalised, so while they may have been spared the ambush of the initial investigations, they should be mindful that they are in the regulators’ crosshairs nevertheless.
What now?
The situation leaves business leaders and compliance teams in a quandary. Should they sacrifice convenience and operational efficiency in the pursuit of compliance, banning messaging apps outright and instead relying on the tried and tested solutions of email, phone calls and, to a lesser extent, social media?
This is probably a tempting option given the enormity of the penalties being administered. It has certainly been the more popular approach given that in July 2022 just 15 per cent of financial firms were monitoring WhatsApp.
But it is not quite that simple. Banning employees from using particular channels does not necessarily mean that all risks are eliminated. The prohibition of helpful tools will probably lead to disgruntled employees and compliance gaps in the workplace.
Business leaders must ensure they can capture, preserve, and monitor conversations.
