Hentsū are excited to announce the launch of our new Regulatory eCosystem. With our newest cloud based platform, Hentsū have assembled a comprehensive suite of leading regulatory services to enable efficient and scalable regulatory compliance. Hedge Funds and Asset Managers using the Hentsū Regulatory eCosystem can access a scalable platform through a single subscription:
  • Best of breed Artificial Intelligence solutions for communications and trade capture, storage, and monitoring to enable compliance with regulations such as SEC, MiFID, MAR, CFTC, and FINRA.
  • Top compliance specialists, consultants, and investigators to help design and oversee your monitoring program.
  • Data specialists and scientists to design, implement, and oversee the detection filters.
Marko Djukic, Founding Director: “Hentsū are committed to servicing our global clients to the highest standard. Expanding our reach and offerings into the regulatory space enables us to offer holistic, end-to-end-solutions that give our regulated clients the ability to always use the most cutting-edge systems available, at an affordable price, by evolving beyond the traditional resource and capital heavy IT model.”

Solutions

  • Analytics: Utilize artificial intelligence and machine learning on stored content. Detect patterns, profile behavior, map social relationships, and use human cognition to uncover risks in eCommunications, voice, and trades.
  • Event & Trade Reconstruction: Perform reviews and high speed extraction of content for investigations or legal discovery.
  • Communications Capture / Control: Moderate, block, and collect all relevant eCommunications.
  • Voice: Compliantly capture and store quality recordings.
  • Content Storage: Centralize all content, including eCommunications, voice, and trades, in original format for native rendering. Supply data to downstream systems and build in-house applications with native APIs.
  • Supervision / Surveillance: Automate the monitoring of communications using risk-based detection filters and review using the most efficient tools and workflows.

About Hentsū

Hentsū is the leading next generation MSP uniquely delivering intelligent cloud-based solutions to Asset Managers and Hedge Funds. We consult, design, implement and manage proven systems that simplify your technology challenges. Deployment is always in a secure, compliant and resilient format that meets the strictest global regulatory requirements. With our expertise and unique market position, we give our clients additional competitive edge through our bespoke solution suite of products, enabling funds of all sizes to leverage the latest cloud-based technology with flexible and secure infrastructure. Questions about your compliance challenges? Speak to our regulatory specialists to book a free compliance assessment and workshop: hello@hentsu.com

Date/Time

Date(s) - 01/01/1970
12:00 AM - 12:00 AM

Location

600 5th ave. NY, NY
  • Encrypted IM apps growth in popularity has seen an increase of their use in conducting business
  • Financial firms require constant communications monitoring in order to meet compliance standards
  • Difficulty regulating encrypted IM apps can lead to major fines by the FCA, FINRA and SEC
  • Hentsū, powered by Actiance Socialite, can capture native metadata in near real-time, ensuring all content are captured in full conversational context
To many, using Instant Messaging apps like WhatsApp to connect with people, is something we do daily without much of a second thought. However, the financial world is full of compliance and regulatory measures that require the monitoring of communications between firms, their employees, and their clients. Thus far, IM apps like WeChat and WhatsApp, have evaded these measures thanks to their encrypted messaging services, however, a number of high-profile cases have highlighted the growing issue with the regulation of these encrypted messaging services. For example, Bloomberg recently reported on how some employees of big financial firms have been secretly conducting business over encrypted IM apps, with one ex-Jeffries banker being fined by the FCA over $40,000 USD for using WhatsApp to share confidential client information. These cases are increasingly common, and are exposing the unlawful and unethical practices that could end up costing firms big money. While attempting to monitor the data and information shared on these encrypted IM apps may seem like a lost cause, with the right technology and expertise, there are ways to ensure IM apps are being regulated.

What are Encrypted Apps and Why They Matter

Over the years WhatsApp has grown rapidly to become a staple in most people’s phones as their go-to for instant messaging. With over 1.2 Billion active users daily, the app’s popularity cannot be understated. It’s relative straightforward to use, able to connect people instantly, so-long as they have access to Internet, and best of all- free. Equally, WeChat, an IM app popular in China, presents the same benefits as WhatsApp, and is used by over 800 million people daily, an increasing amount of which are businesses. With so many people using these free and easy apps, it’s plain to understand why they are so popular by firms and their clients alike. The fast-response rate, coupled with the fact that many employees and clients use these apps in their everyday life, makes them an easy place to conduct business. The problem arises because many of the features they present are not compatible with the compliance and regulatory requirements of the FCA, FINRA and SEC. Firstly, their content is encrypted end-to-end, making collection and monitoring very difficult. Additionally, the lack of APIs impedes automated capture of content, meaning it requires someone to manually capture, a time-consuming process, where human error can lead to critical content accidentally being omitted. Furthermore, even once captured, the dynamic, feature-rich content is converted to email form by most archives, complicating monitoring and eDiscovery response time. All these issues mean that, despite their popularity, encrypted IM apps do not meet financial firms requirements to keep records of all written business communications. It is down to firms to ensure their compliance requirements are being met, and to guarantee the regulation of their communications. Nonetheless, as seen, these IM apps are presenting a new challenge in compliance- especially when it is highly likely that these applications are currently in use, unmonitored.

How to Manage, Secure, and Ensure Compliancy

Often times technology evolves faster than we can keep up, leaving many clueless as to how to tackle the many loopholes they create. While this may have initially been the case with these encrypted IM apps, the real challenges they present to compliance has pushed for innovative solutions. Hentsū Connect, powered by Actiance Socialite, captures WeChat and WhatsApp native metadata in near real-time, ensuring all content including encrypted messages, conversations, emojis, photos, links, and shared documents, are captured in full conversational context. With this unique method, the entirety of communications are preserved- even deleted content. It also provides compliant storing, monitoring and reporting across user, group, and global data in order to meet the most stringent regulatory requirements. Thus, not only is this the best and first solution to the market, it deploys in a matter of hours, by simply leveraging the existing WeChat/WhatsApp authorization process without requiring the installation of new applications on user devices. This effectively ensures that firms can are compliant in no-time at all, minimising regulatory risks with minimal hassle.

How Hentsū can Help

Hentsū enables firms to conduct business on these encrypted messaging applications and over 80 different channels compliantly. Contact us at: hello@hentsu.com

Date/Time

Date(s) - 01/01/1970
12:00 AM - 12:00 AM

Location

600 5th ave. NY, NY
Artificial Intelligence (AI) is one of the hottest topics in technology at the moment. Despite this, Hentsū has seen that a large portion of client’s compliance and regulatory functions are still being performed using antiquated tools developed decades ago where simple keywords, phrases, and statistical models are thrown at a database of data with the hopes of detecting risks. Even primitive spam filters using AI from the 1990’s are more advanced. This is absurd considering that the increases in computing power, decreases in the costs of data storage, and rise of distributed computing over the years. It is now possible for anyone to "spin-up" an AI project within a few minutes on AWS, Google, or Azure. While the promise of leveraging human cognition for machines to solve crucial problems, such as finally finishing the last book of Game of Thrones, seemed quite impossible only a few years ago, we’re now using technology, like Hentsū Regulatory Ecosystem, to ensure unnecessary risks are not being taken.

RegTech and AI

While our customers generally use AI and Machine Learning (ML) for research models and algorithms to generate returns, the revolution in regulatory technology (“RegTech”) sees human cognition applied to reducing risks and costs, such as performing market abuse surveillance. Hentsū is seeing demand from firms into technologies that are able to process a lot of different types of data, such as trades, communications, and personnel data to uncover hidden relationships and anomalies. These are driven by ever increasing regulatory fines, reputational damage, and a push across the industry to reduce operational costs. A prerequisite is having the right data platform to collect and centralize content into one place; similar to a data lake. Once the data is properly enriched to suit the use cases one or more of the following techniques are employed to uncover risk in a way that using just plain rules and keywords cannot do:
  • Participant Profiling
  • Network Analysis
  • Risk Scoring
  • Natural Language Processing (NLP)
  • Voice Analytics
  • Sentiment
  • Trends and Anomalies
  • Behavior Profiling
  • Correlation
  • Classification
  • Machine Learning Feedback
Using market abuse as an example, firms may train their detection scenarios to identify when a trader is chatting with another market participant with whom they have a personal relationship, as determined by historical conversations. When Natural Language processing identifies potential collusion in a chat, the detection scenario can then look at all channels of communications, as well as trade and market events, to detect correlations. Having all relevant and historical data, and the power to process it and make correlations, it possible to uncover when the same group of individuals routinely move their IM chats to WhatsApp and then are involved in the same trades at key times - such as during a benchmark setting. In the case of transaction or trade monitoring, having the historical trading pattern of an individual can detect whether "spoofing" has occurred or whether the activity was a proper part of the trader’s style or strategy. Without the pattern recognition, cognition, and the ability to “learn” over time, traditional tools will just continuously create alerts each time certain fixed thresholds were triggered. Furthermore, having a library of past enforcement cases to “learn from” would allow for pattern recognition to replace hard-coded rules that never self-adjust via Machine Learning.

Innovative Compliance

Compliance and simplicity are two words not often associated with one another. However, the Hentsū Regulatory Ecosystem is built on cloud platforms and using advanced AI. It enables the collection, monitoring and storing of disparate sources of data through our suite of best of breed compliance and regulatory technologies. It also offers one-stop subscription to the top artificial intelligence consultants and solutions on the market. There is no need to still be relying on outdated tools when simpler, more innovative solutions are readily available. Have compliance and regulation questions? Come talk to us… you can contact us at: hello@hentsu.com

Date/Time

Date(s) - 01/01/1970
12:00 AM - 12:00 AM

Location

600 5th ave. NY, NY