The Carrot or The Stick? Why Financial Firms Are Finally Addressing The Fraud Hiding in Voice Communications

Since the introduction of ​​MiFID II and the Dodd-Frank Act, financial firms around the world have been attempting to record and monitor their corporate voice communication data with varying degrees of success.

This challenge has been exacerbated in recent years by the increasing volumes of voice data, aided by the rise of working from home. Over the past 12 months alone, Behavox customers have experienced a 94% increase in the volume of corporate voice communication data.

Compliance Carrot Or The Regulatory Stick?

The idea of monitoring voice data for fraud may seem like an insurmountable task for some firms. Legacy compliance solutions struggle to integrate and capture data from the latest voice platforms, let alone analyze the data for risk.

However, regulators are increasingly urging firms to overhaul their approach to monitoring voice data. It appears that conducting random samples of voice calls no longer cuts it when it comes to making a concerted effort to locate the fraud hiding within the data.

Manually reviewing just 1% of employee voice communications is as arduous as it is time-consuming. For a firm capturing 250,000 pieces of voice content per month, that’s 2,500 calls for a compliance team to review. They simply do not have the time to trawl through hours of randomly selected phone calls to find the needle in the haystack.

Instead, regulators want firms to take a proactive approach to monitoring voice communications, applying the same level of scrutiny as they would to written communications, such as email and instant messaging.

Solutions such as Behavox Voice are able to capture and transcribe voice communications from a wide range of channels and apply AI-powered algorithms to analyze the data for fraudulent activity. Using Behavox Voice, the same firm capturing 250,000 pieces of voice content per month now only has 216 calls to review as they have been proactively identified by Behavox Voice. What’s more, the firm is now actually finding relevant content in voice communications rather than hopelessly trawling through calls without any hope of identifying non-compliant behavior.

Proactively finding fraud in voice communications is now a reality. While some firms are waiting to be hit with the regulatory stick before finally overhauling their approach to voice monitoring, the carrot of reducing fraud on highly susceptible channels is motivating forward-thinking firms to act now.

Rogue Employees Are Turning to Voice

One of the key motivating factors for firms implementing AI-powered voice monitoring is that employees are more aware than ever that their emails and instant messages are being monitored. And, at a time when in-person meetings are still not as common as they previously were, rogue employees are turning to a major compliance blindspot – voice calls.

Safe in the knowledge that firms are struggling to record calls, let alone effectively monitor them for fraud, voice is the rogue employees’ channel of choice. 

Firms that believe it is prohibitively expensive to implement an effective voice monitoring program should consider the monetary penalties that have been levied for regulatory breaches in recent years. Being able to identify instances of market abuse that may have otherwise been missed is a powerful differentiator for the firms that are tempted by the carrot of compliance rather than waiting to be hit with the regulatory stick in a few years’ time.

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