The majority of financial institutions fail to monitor their employee’s WhatsApp conversations, according to new research shared exclusively with City A.M. today.
A new poll of almost 100 City players, including investment banks, brokers, and investment managers, found that just 14 per cent actively carry out effective supervision or surveillance over the world’s most popular social messaging application, according to VoxSmart.
The findings come following JPMorgan’s $200m fine, or £160m, for failing to monitor their employees use of WhatsApp and attempting to rely on an outdated policy of prohibition.
Having come to prominence in energy markets in 2016, WhatsApp is now the de facto messaging service across global capital markets.
“If I had $1 for every time I’ve been told ‘our traders don’t use WhatsApp’ in the last 7 years – I could buy Twitter!”
Oliver Blower, CEO of VoxSmart.
Oliver Blower, CEO of VoxSmart, told City A.M. that firms aren’t reacting quickly enough to the sizeable sum J.P Morgan were fined by regulators last year, leaving themselves exposed to similar fines.
“The fact is, in today’s fast paced trading environment, WhatsApp and other social messaging applications will continue to be used by both staff and clients alike,” he added.
“But instead of trying to restrict employees from using social messaging applications, financial institutions need to embrace modern technology, in order to practice effective supervision and risk management,” Blower concluded.