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Although the two bodies of the legislature are independent, they are closely related and meant to complement each other. GDPR references how personal data is collected and stored whereas ePrivacy references how personal data are communicated electronically and how non-personal data are managed.
Keeping up with regulatory changes can be a challenge within any industry, and the post-2008 financial sector is no exception. Global regulatory responses to the financial crisis triggered an onslaught of new rules and laws meant to curb the potential for fraud and abuse in financial services markets. This deluge of new regulation has overwhelmed compliance departments at some financial institutions. However, companies that are embracing new developments in regulatory technology (RegTech) are developing systems capable of maintaining compliance with the millions of pages of new regulatory documents published each year.
The people working in financial services are now facing new challenges to the privacy of their personal data. Regulations passed to improve transparency in financial markets require firms to capture, record, and analyze all electronic communication data.
Earlier this month, the New York Department of Financial Services (DFS) assessed a $40 million fine against Standard Chartered. The DFS hit the financial firm with the multi-million-dollar penalty after discovering that its traders had attempted to rig transactions in foreign exchange markets. While the amount of the fine was appropriate given the degree of collusion and fraud involved, the timing of the enforcement action took the financial industry by surprise. This is because all of the illegal activities uncovered at Standard Chartered occurred between the years of 2007 and 2013.
Anti-fraud, anti-money laundering and other financial regulations require financial services companies to track electronic communications in various forms. However, this often requires these firms to collect substantial volumes of different types of communications data. Standard lexicon-based search software commonly used in financial services is effective up to a certain level of scale and complexity, but the demands of today’s financial regulators are outpacing traditional enterprise software solutions.