The FSA is proposing to record cell phone conversation of traders. It estimates that it should be recording the use of 22,000 phones.Bloomberg reports—
Mobile phones used for business shouldn’t be exempt from rules that require financial companies to record employees’ calls which the Financial Services Authority can listen to later, under proposals the agency said could take effect as soon as the final quarter of 2011. Around 22,000 phones would be covered, the FSA estimated.
“Removing the exemption will provide an additional source of contemporaneous voice conversations and electronic communication evidence,” the FSA said today. “This can also help us to counter market abuse, one of our key priorities.”
The FSA is increasing efforts to stamp out insider trading after criticism from lawmakers that it wasn’t doing enough.
Cell phones are barred on many trading floors in the United States, although we’ve frequently seen them being used quite openly. Many traders seem to assume that the texts and conversations they have over cell phones are private and unmonitored. This is a mistake.
“The U.S. insider-trading case against Galleon Group LLC’s chief executive officer, Raj Rajaratnam, was brought using evidence in part from his mobile-phone conversations which the government got permission to wiretap,” Bloomberg’s Caroline Binham reminds us.
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