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Shield and LeapXpert Survey Report Highlights WhatsApp and Messaging Channels Remain Biggest Threat to Bank Risk Management Despite Massive Fines

Shield, solving communication compliance for financial institutions, and LeapXpert, the responsible business communication pioneer, partnered to release findings today that show only half of financial institutions (51%) are monitoring employee communications over WhatsApp. Even fewer institutions capture SMS, iMessage, LINE, WeChat, Telegram, and Signal, despite heavy fines issued by US regulators for failing to limit employees using messaging apps on their mobile devices.

The report reveals that while virtually all compliance officers surveyed plan to monitor WhatsApp and other messaging apps by the end of 2023, 73% of financial institutions still lack confidence in their ability to enforce bans on mobile communications over unapproved channels.

Last September, an SEC probe found that from 2018 to 2021, employees at several leading banks frequently used off-channel communications to conduct business. In the last 18 months, $2 billion worth of fines have been levied at more than a dozen financial firms.

Surprisingly, multi-million-dollar fines do not occupy the top spot among the concerns of compliance professionals. They come in second place with 34% of respondents selecting them as the top concern. The greatest fear revolves around regulatory audits themselves with a significant 64% ranking them as their primary concern. Internal audits follow behind at 32%, while concerns about reputation damage stand at 28%, and losing business data at 27%.

Other survey findings:

  • 57% of US companies are already monitoring WhatsApp compared to 44% of their EU counterparts.
  • Respondents expect a shift in mobile device policy, rising from currently 53% issuing corporate devices to 66% in 18 months.
  • While only an average of 29% of respondents reported monitoring WhatsApp, SMS, iMessage, LINE, WeChat, Telegram, and Signal at the moment, this is set to skyrocket to an average of 90% by the end of 2023.

“When the massive SEC fines were issued, it seemed imminent that widespread changes across the industry would occur,” said Shield Co-founder and Chief Business Officer Eran Noam. “Our report shows that this has not happened. While data capture, monitoring, and user experience challenges are real, confidence in banning policies is low. Technology gives companies the option to monitor these channels rather than simply implementing policy bans, which don’t provide full coverage. This is where the Shield and LeapXpert partnership comes into play. LeapXpert offers compliant, governed and secure communications on messaging and voice channels, while Shield offers multi-layered AI surveillance to manage and mitigate communications compliance risks.”

“The surge in demand for comprehensive compliance solutions in 2023 reflects a clear realization among financial institutions that closing compliance gaps is imperative,” said Avi Pardo, Co-founder and CBO at LeapXpert. “From installing messaging capture solutions to seeking robust governance controls, organizations are now determined to transform all popular messaging apps used by their team members into approved and compliant channels. As regulatory scrutiny intensifies, companies understand the need for decisive action and solutions that help minimize risk by ensuring messaging compliance.”

Conducted in April 2023 by Global Surveyz, the survey examined the challenges financial compliance departments face in capturing and surveilling unmonitored communication channels, the effectiveness of banning these communications, which channels are the most concerning, and financial organizations’ plans to regulate employees. The survey polled 200 finserv professionals, 100 in the U.S. and Europe each.

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