SMS messaging has become increasingly common in financial firms because of its convenience and incredible engagement rate. Nevertheless, text messaging poses a significant risk to the financial industrysince supervising and recording can be difficult. Failure to monitor all messages can result in compliance violations, most notably if your employees are texting secretly.
Despite these threats, financial firms must adapt to maintain efficiency and relevance. Companies can confidently utilize the power of SMS for marketing and customer service with the help of mobile archiving tools and well-laid-out policies. You and your employees needto stick to your firm’s rules to ensure you do not face ramifications.
Ways to Maintain Compliance
Obtain Consent before Texting
Though your clients prefer to communicate over the phone, they must be informed about your plan to send them SMS messages. Sending messages without them opting infirst may label your company as a spammer and, consequently, may put you in potential legal consequences.
Inform Clients of Text Frequency
For new contacts, set up an auto-reply response informing them how often they might receive texts from your company. SMS frequency should be included in your initial opt-in message.
Strictly Send Relevant Information
You cannot send several things to your clients, particularly images and videos. To avoid getting labeled as a spammer or facing trouble with regulatory bodies, keep your SMS messages strictly limited to relevant financial information.
Use an Archiving Solution
One of the best ways to maintain regulatory compliance is to use SMS message and call archiving software. These tools effectively record and keep copies of all phone conversations, providing a genuine database you can use in the future.
Risks of Non-compliance
Many financial firms remain negligent with SMS compliance, exposing them to risks that could ruin their reputation.
Being found guilty of non-compliance may result in lowered client trust, resulting in possible revenue loss, damage to shareholder value, increased operating costs, and regulatory costs.
Legal consequences also abound. In the event of an e-discovery or litigation, courts may request text messages. Failing to provide any may put the firm in trouble.
Finally, regulatory bodies, like SEC and FINRA, require supervision and archiving of all messages kept by financial firms. Non-compliance is strictly prohibited and may place the company atserious risk. To understand more about the Securities and Exchange Commission’scompliance expectations, check out this infographic by TeleMessage.
