MiFID II: Your Guide to Meeting the Record Keeping and Surveillance Requirements
What is MiFID? Markets in Financial Instruments Directive (MiFID) is the European Union framework legislation for financial instruments and their organised training. Whilst it has…
What is MiFID?
Markets in Financial Instruments Directive (MiFID) is the European Union framework legislation for financial instruments and their organised training. Whilst it has been in place since 2007, new revisions are being made vis-a-vis the financial crisis and the need to protect and strengthen financial markets and investors.
These revisions, known as MiFID II will be enforced from the 3rd of January 2018, but with almost every financial organisation initiating a change control freeze during December, the go-live date will effectively be the 30th November 2017.
Who is Impacted?
All financial services firms undertaking business within the European Economic Area will have to comply with the MiFID requirements. This means many firms are facing hundreds of pages of documentation that set the terms of the legislation. The effects the new legislation will have are far reaching. They will impact the ways in which they operate and function, effecting everything from trading, transaction reporting, client services, IT and even HR systems.
Asset Managers and small Broker-Dealers have regulatory requirements to compliantly collect, store, and produce firm books and records. Firms have additional regulatory responsibilities to monitor electronic communications and trades for potential violations. Today, Asset Managers and small Broker-Dealers need to spend almost $1mm / year on infrastructure, software, and resources to remain compliant with regulatory requirements – often enlisting multiple vendors to form a complete solution.
Use Hentsū to Help Meet the MiFID II Requirements
The hundreds of pages of documentation cover a number of topic areas, and without the proper knowledge and insight, navigating the never-ending legislation can be time consuming. Hentsū has invested time and expert knowledge in understanding and mastering the requirements asked by MiFID II.
This has culminated in the Hentsū Regulatory eCosystem, the first solution on the market, which enables financial firms to meet the end-to-end requirements of the upcoming MiFID II regulation through our suite of best of breed compliance and regulatory technologies.
Hentsū offers a one-stop subscription to the top artificial intelligence consultants and solutions on the market, to help firms efficiently monitor and capture risks in trades and communications. The Regulatory eCosystem includes:
Amongst the requirements being enforced in the new legislations, firms must capture records, in context, across multiple communications and collaboration channels from all approved devices. Hentsū helps clients manage retention policies governing all forms of communication, as well as the creation and management of granular policies across specific users, groups, business units, and geographic market units.
Records must include the recording of telephone conversations or electronic communications relating to, at a minimum, transactions concluded when dealing on own account and the provision of client order services that relate to the reception, transmission and execution of client orders.
Through the Hentsū suite of best of breed technologies, we help you retain good quality recordings of voice conversations so regulatory markets can identify and protect investors from potentially inappropriate behaviour.
MiFID II that firms gather together all communications related to a trade upon the request of a regulator. Firms must be able to supply regulators with communications associated with a specific trade. Trade reconstructions must include structured records as well as relevant unstructured records as they pertain to a trade.
The Hentsū Regulatory eCosystem helps capture and index all forms of structured and unstructured content, ensuring that trade data can be analysed in conjunction with communications information.
Firms must establish supervisory policies and procedures to ensure that managers, employees, agents, and outsourced regulatory markets comply with the directive. The Hentsū solution, allows monitoring for business, conduct, and market risks.
Firms must make records available to clients for five years and for up to seven years for regulators. Records must be maintained in a durable medium that cannot be altered or deleted but must be searchable and readily available upon request.
The Hentsū platform enables safe and secure content storage that adhere to these standards, including SEC 17a-4. It also ensures retention of information for the required seven-year retention period.
Consulting, Integration, and Expertise
The eCosystem offers access to the top regulatory and technical expertise for industry advice, best practices, and helps enable compliant management and configuration of systems and monitoring programs.
The relative ease and functionality of the Hentsū Regulatory eCosystem is a huge relief for clients looking to meet the strict deadline and fully ensure compliance with the new legislation. Instead of swamping through hundreds of pages of regulations, firms now have the option to trust that their compliance is being handled by capable experts and consultants.
Download your grab-and-go guide to meeting the MiFID II requirements here.
We would love to hear about your challenges around MiFID II and where we can help! Email us at: hello@Hentsū.com