Effective and compliant unstructured data archiving for the financial industry
Social media is a valuable tool for the financial industry in the same ways it has benefited many other types of businesses. Social networks are, by both design and adoption, optimized for one-to-one and one-to-many interactions. Social helps build a brand and gives some personality to companies in an industry that can be especially professional and buttoned-up at times. All of these positive differentiators are available with the right social media strategy, and financial firms of all sizes have proven the power of social in the industry.
Similar types of unstructured digital data, like instant message chat logs and emails, are also valuable tools that fill both internal and external roles at financial companies – and produce records that need to be retained. With so much unstructured data flowing through the finance industry, it’s imperative that effective archiving solutions are in place.
“With so much unstructured data flowing through the finance industry, it’s imperative that effective archiving solutions are in place.”
The major concerns of regulatory compliance
Compliance is the key difference when it comes to finance and unstructured data. While other industries have some level of regulatory compliance needs in terms of data and communication archiving, the financial world has many of the strictest requirements. Many financial organizations deal with more than one set of regulations at once, a problem that’s exacerbated when international business comes into play. With the strengthening of existing regulations and the introduction of relatively new, sweeping rules from Sarbanes-Oxley to Dodd-Frank, compliance is at the forefront of many business leaders’ minds.
A lack of proper record retention policies and tools can quickly lead to sanctions and severe financial penalties. The most recent high-profile example comes from Deutsche Bank AG, which landed in regulatory trouble for failing to properly store the conversations some employees had on internal chat clients, as The Wall Street Journal reported. This lack of effective data archive solutions could mean significant financial losses.
While this specific example involved archiving internal chats, the same rules apply to social media, emails and many other types of written digital communication. Financial businesses that want to be as prepared for regulatory or legal scrutiny as possible – and meet the many regulatory demands faced by the industry – must use a data governance solution that provides comprehensive, secure storage, indexing, and access.
Key elements to look for in a solution
Not all archiving solutions offer the same advantages or depth of functionality. In the financial industry specifically, there are a few things decision-makers have to look for. One of the most important is an accurate, advanced archiving process. Far beyond the antiquated backup systems once common for data storage, a strong archiving solution will offer capture in real time or close to it, avoiding issues with losing information in the interim. Specific questions of compliant storage under SEC and FINRA regulations – the need to maintain unaltered records that prohibit editing at a later date – must also be addressed.
Fast and accurate search is another major consideration for financial firms. With the need to recall unstructured data from many places, a platform that both captures and stores information from a variety of sources provides some significant benefits in terms of efficiency. When the time comes for a regulatory review, be it an internal test or an external audit, or a legal action, effective search makes the efforts of compliance staff and others far more effective. Reporting and alert functions are also especially valuable for financial institutions. These features increase organizational knowledge of compliance efforts and inform the right personnel when certain prohibited words and phrases are used.