Feeds

MiFID gives most firms a headache

Record-keeping bamboozles, survey finds

Build a business case: developing custom apps

Firms across Europe have just two weeks to comply with a law that aims to create a single European market for financial services. But most are struggling with the directive's record-keeping duties, according to survey findings published today.

The Markets in Financial Instruments Directive (MiFID) harmonises the regulatory regime for investment services across the 30 member states of the European Economic Area (the 27 Member States of the EU plus Iceland, Norway, and Liechtenstein).

Article 51 of MiFID (pdf) demands the retention of certain records by financial firms for at least five years. Others must be kept for the duration of the relationship with a client. A firm's retention must be in a manner that allows national regulators "to access them readily and to reconstitute each key stage of the processing of each transaction".

This causes a problem for firms, according to the independent think tank JWG-IT. It claims that 64 per cent of financial firms say they cannot reconstruct events after the fact in reasonable timeframes or cost levels.

PJ Di Giammarino, CEO of the London-based group, warned that if record keeping is done incorrectly, it could falsely trigger or hide market abuse issues.

"If you get caught out with it wrong, it could cost you hundreds of thousands of euro in fines," he said. "If what you have given to the regulators, the market, and your customers does not match what you hold internally for up to five years from 1 November, you are exposing yourself to new risks.

"Record keeping is a big problem and we are working with the industry to make senior management more aware of their new responsibilities under a principles based regime."

JWG-IT is appearing at the Storage Expo, at Olympia, London, this week.

Copyright © 2007, OUT-LAW.com

OUT-LAW.COM is part of international law firm Pinsent Masons.

Related link

Minimum records that the FSA requires UK investment firms to keep (pdf)

Build a business case: developing custom apps

More from The Register

next story
iPad? More like iFAD: We reveal why Apple fell into IBM's arms
But never fear fanbois, you're still lapping up iPhones, Macs
Sonos AXES support for Apple's iOS4 and 5
Want to use your iThing? You can't - it's too old
Amazon says Hachette should lower ebook prices, pay authors more
Oh yeah ... and a 30% cut for Amazon to seal the deal
Philip K Dick 'Nazi alternate reality' story to be made into TV series
Amazon Studios, Ridley Scott firm to produce The Man in the High Castle
Joe Average isn't worth $10 a year to Mark Zuckerberg
The Social Network deflates the PC resurgence with mobile-only usage prediction
Chips are down at Broadcom: Thousands of workers laid off
Cellphone baseband device biz shuttered
Feel free to BONK on the TUBE, says Transport for London
Plus: Almost NOBODY uses pay-by-bonk on buses - Visa
Nintend-OH NO! Sorry, Mario – your profits are in another castle
Red-hatted mascot, red-colored logo, red-stained finance books
Twitch rich as Google flicks $1bn hitch switch, claims snitch
Gameplay streaming biz and search king refuse to deny fresh gobble rumors
Stick a 4K in them: Super high-res TVs are DONE
4,000 pixels is niche now... Don't say we didn't warn you
prev story

Whitepapers

Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
Boost IT visibility and business value
How building a great service catalog relieves pressure points and demonstrates the value of IT service management.
Why and how to choose the right cloud vendor
The benefits of cloud-based storage in your processes. Eliminate onsite, disk-based backup and archiving in favor of cloud-based data protection.
The Essential Guide to IT Transformation
ServiceNow discusses three IT transformations that can help CIO's automate IT services to transform IT and the enterprise.
Maximize storage efficiency across the enterprise
The HP StoreOnce backup solution offers highly flexible, centrally managed, and highly efficient data protection for any enterprise.