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Structuring Voice for Trade Reconstruction and Business Analytics

Posted 20/03/17

Advancements in the regulatory spectrum are being implemented to improve transparency as well as foster responsible standards for investment banks and brokerages. In response, there have been multiple technology advancements to help the firms comply with the regulations and reduce the risk of penalties for breaches or non-compliance. Many of the new technologies under the banner of FinTech or RegTech solve compliance issues for electronic trading; however, voice trading is and will be widely depended upon for trading more complex instruments such as swaps and derivatives.

The voice quality transmitted between desks continues to improve with the introduction of high definition audio, enabling better quality capture by the recording infrastructure. But, there are still complexities and process issues that plague voice communications and could potentially introduce risk factors.

  1. Is the voice quality transmitted by the desk transcoded when it reaches the recorder? If so, the quality may be compromised. Most monitoring solutions measure voice quality across the network, exclusive of the egress and ingress devices. Nxtera’s Reflect solution measures voice quality from the phone or dealerboard across the network and through the recorder to assess and score the full impact of the audio journey as the recording is laid to disk.
  2. Are you recording users per policy correctly? In addition to ensuring the audio quality is acceptable for transcription to text, it is equally important to have governance over real time voice transactions. Nxtera Parity compares every call made against the established recording policy and reports any anomalies for immediate intervention, thereby protecting the firm against potential downstream compliance breaches.
  3. Are the users making calls using the correct devices? If a trader uses a different device, you may be recording but you may not be able to match the recordings to the correct trader if they have not logged on correctly. The Nxtera nTelligence engine compares users logged on to different devices on the same desk and reports discrepancies. If a trader logs on to a computer as one user and the dealerboard is logged on under a different user, an alert is triggered.

If the audio quality is not compromised along the journey, traders are being recorded to policy and the correct users are being recorded, firms can better meet the statutory regulatory requirements, protect the firm from financial and reputational damage and collect meaningful business intelligence to support new business strategies and regulatory obligations. Nxtera automated assurance software has been delivering a superior solution to address compliance challenges associated with voice trading since 2010.

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