Automating Call Extractions for Regulatory Investigations

8 February 2018

2

Changing Regulations

• Dodd-Frank is fully in force

since August 2013

• Record and archive all electronic communications such as voice, emails, instant messages, communication files and 3rd party messages

• Communications to be captured, tagged, retained, searchable and available to the regulator within 72 hours from the request

• Make sure systems are running- Firms need to have insight into their system to ensure that they are functioning properly

• Transaction Reconstruction: Compliance departments upon request need to be able to find requested data, then be able to find all relevant communications

• Prevent Fraudulent Practices: Now that firms captured voice, email, IM and chat for their traders, they must have some form of monitoring and surveillance in place

Strict Regulations Around Communications Are on the Rise

Dodd-Frank

• MAR is in force since

July 2016

• Record all communications of ‘Direct Market Participants’ (Brokers and Dealers)

• Be able to identify intent related to a event and actions behind the event which requires surveillance that highlights possible fraudulent behavior

• To identify an entity how may facilitate the dissemination of false or misleading information

• Be able to monitor trading based on Material Non-Public Information(MNPI)

• Be able to take handling instructions communicated from clients and in case of best executions investigations compare the instruction to the activities of the trades

• Benchmark Submitters- Those firms that have a submitter to establish a rate now fall under increased supervision. Monitoring their communications with other submitters, within the same bank, or others, is now under major focus to ensure and prevent possible collusion

MAR

• MiFID II will come into force in

January 2018

• Monitor all Voice Communications -internal & external, inbound & outbound, pre- & post trade, front- & back-office, mobile phones

• All conversation must be retained for at least 5 years

• Notification of recording: parties outside the frim must be notified all communication will be recorded

• Monitor all Electronic Communications -Emails, Chats (e.g. Bloomberg, Thomson Reuters, Yahoo), etc.

• Monitor Market abuse: firms must provide evidence they can detect behavior around market abuse

MiFID II

• Code of conduct was updated

May 2016

• Compromising Confidential Information-Firm need to demonstrate how they protect Confidential Information and promote effective communication that supports a robust, fair, open, liquid and appropriately transparent FX Market.

• Complete and Accurate Data- This is fundamental to support effective surveillance. Automated algorithms should be documented and are subject to design and effectiveness reviews. Each communication alert should be dispositioned to the extent that it can be independently reviewed and audited

• Measure and Monitor- firms are expected to promote and maintain a robust control and compliance environment to effectively identify, measure, monitor, manage, and report on the risks associated with their engagement in the FX Market.

FX Codes of

conduct

Regulations Are Changing Recording Demands

4

More Modalities More People

More ReportsMore Data More Conversations

More Proof

5

Introducing

Are all calls archived successfully with the correct retention periods?

How do I export the calls we are asked for quickly?

Can I prove the correct people are in the system and successfully recording?

Can I prove “outside parties” are aware conversations are recorded?

How do I know the recording system is working even though I haven’t received any alarms?

Is the recording quality adequate?

Did I capture everything I

should have?

Can I capture new modalities

from Skype and Cisco?

Can I find the calls I am asked for

quickly?

What questions do you have to answer?

6

Are the correct people recorded?

Capture Prove

Retrieve

NICE COMPASS – Solution Overview

7

Retention Control

Search & Replay

User Data

Dashboards

Events IndexAuditing

Announcement

Control

Provisioning and

Reporting API’s

Portal

Manage

Control

Reports Download User Management

System Assurance Voice Quality

Control

Capture

Turrets PBX Mobile devices

COMPASS

Application

NTR /

NRX

Unified Communications

The central Portal provides

access to all modules of the

application

The Management layer

stores all the calls, users,

audits and system event

data

The Control layer is for

retention management,

audio announcements and

data access

The Capture provides

interoperability with the

vendor specific

communications platforms

and records the data

8

Media Extraction

HQ / Central Site

COMPASS – Architecture

9

Site 2 Switzerland

COMPASS Portal

Extraction Server

Recording Check Index / LogStash

Satellite

Core

CTI

Satellite

Extraction ServerExtraction Server

Satellite

Core

CTI

Satellite

Search &

Replay

Recording

Check

Download Reporting Dashboard

Site 1

Satellite

Core

CTI

Satellite

COMPASS Portal

Question

• How do I export relevant conversations for a compliance

investigation, easy and fast?

Answers

• Bulk Download provides a secure, auditable solution

• Bulk Downloads can be performed with a simple job

creation directly from the COMPASS portal

• 1.7 Million calls can be downloaded per day on a single

extraction server

• Queries are batched and queued to ensure there is no

impact on operational systems (1% CPU load)

• Technology neutral .xml and .wav output enable easy

interoperability

• Selectable time range and users

• Downloads in the background to allow continued

working

COMPASS – Portal Download Application

10

Current Downloads

Progress

Select Users

and/or Groups,

create Start and

End Date and

trigger operation

Historic

Downloads

Audit

COMPASS – Download

11

Site 1

HQ / Central Site

COMPASS Portal

Core

Bulk Hold &

Extract

Rules

1. Extract Rules are set for

Extraction Server

2. Extraction Server runs

Queries on Core

3. Audio is copied from Archive

and saved in Extract Folder

Bulk Hold & Extract

Extraction Server

Extract rule

ExtractQuery

ArchiveExtract folder

Copy Paste

Satellite Satellite

1

2

3

COMPASS Portal

COMPASS – Download User Interface

12

View of all active bulk

extraction jobs and there

progress

History of all extraction jobs

completed. Details stored and

can be reviewed by expanding

the job in question

Manage Estate to limit when

extraction jobs run if required

Schedule when the jobs are

executed

Create and define

and extraction job.

Multiple jobs can be

created and will be

queued to protect the

load on the recording

systems

COMPASS Download Flow

13

Archive DES PoolExtraction

Destination

Extract Meta User_x NTR 1

Extract Content Chunk for User_x NTR 1

Write Extraction

Data Set

NTR 1 NTR 2Job Started In Compass

Compass Users & NTRs in Scope

Process Export Chunk

Parallel Extraction in Pool

1 Concurrent Extraction Chunk Per NTR

Extract Meta User_y NTR 2

Extract Content Chunk for User_y NTR 2

Wrap Up Extraction Job (ZIP Protected)

Process Export Chunk

NTR 1 NTR 2 Archive DES PoolExtraction

Destination

Data Extraction Server Concept

14

COMPASS

Framework

COMPASS

Backend

Application Framework

Services

Extraction GUIExtraction Config

WCF

Job Worker

Job Controller

Compass

backend

DESNTR

Archive

NTR DatabaseData Extraction

DES API

SEARCH API

STORAGE API

Extract Locations

User Manager Content Manager System Manager Alarm Manager Audit Manager

Search & Replay Dashboard ReportsUser Admin

COMPASS Download Data Structure

15

DES 1 DES 2

Users

Steven_IPC,

Jurgen_IPC

NTR 1

Users

Steven_Cisco,

Jurgen_IPC

NTR 2

Compass

Start Extraction Job User: Steven & Jurgen

Extraction Destination Folder Structure

Extract

Location

(root)

Job Name

(creation

date_time)

DES 1_

Part.zip

DES 2_

part.zip

Steven_IPC

Jurgen

Wessel

Steven

Logan

NTR 2NTR 1

Steven_

CiscoJurgen_IPC

NTR 2NTR 1

Jurgen_

Cisco

DES Pool

Compass

Username

NTR

Hostname

NTR

Recording

Name

Extract User

Steven_IPCExtract User

Steven_Cisco

Extract User

Jurgen_IPC

Extract User

Steven_Cisco

ZIP & Move

ZIP & Move

DES Pool Extraction

Location

Download Summary

• Date, Time, Parameters

• Reconciliation - Interactions Found, Downloaded, Failed

Metadata

• XML Format

• Full interaction metadata

• CDR with linked Media (VOX)

COMPASS Download Report & Metadata

17

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Thank you for joining

Navigating & Automating Compliance

1. The Global Impact of New Regulations on Communication Compliance

2. Achieving Recording System Assurance with Automated Recording Checks

3. Compliance Assurance Evidencing with Automated Reporting and Alerting

4. Automating Call Extractions for Regulatory Investigations

www.nice.com / compliance

For more information visit: www.nice.com/compliance