BlackBerry has teamed up with a London start-up to help banks monitor traders that use WhatsApp and other encrypted messaging tools.
The Canadian company, which has stopped making handsets to focus on security and productivity tools for smartphones, has partnered with UK technology company VoxSmart to offer financial services companies a new way of monitoring instant messages.
Banks and other financial services businesses already record and monitor their employees’ phone, email and text messages to make sure they are complying with insider trading rules and other regulations.
But messages sent over WhatsApp are encrypted as soon as they are sent which means that the banks do not have a record of what was said by staff if they use the Facebook-owned platform.
VoxSmart’s technology solves the problem because it sits on the phone and takes a record of the contents of the message before it is encrypted and sent.
Several banks have banned the use of new media from work-issued devices, but the situation has become trickier as banks move towards a “bring your own device” policy.
The Financial Conduct Authority fined one investment banker £37,000 in March over a boastful message he sent over WhatsApp that contained confidential information. The messages were discovered when the banker handed his phone in for inspection.
BlackBerry and VoxSmart said that the product would help financial services companies comply with Mifid II regulations that come into force in January 2018.
The new rules will require that records including all electronic and instant messaging communications, telephone conversations and text messages related to a deal, even if one does not occur, are kept for five years.
VoxSmart, which already counts broker TP ICAP as a customer, said that it would monitor WhatsApp and WeChat as part of the BlackBerry deal. A spokesman said it could also monitor other apps such as Telegram but that no customers have asked to do so yet.
The financial details of the deal were not made public.
Chris Brennan, a partner and financial regulation specialist at Addleshaw Goddard, said that the technology sounded “clever” but questioned whether it was necessary. “A better solution is to block WhatsApp altogether and that would probably be cheaper too,” he said.
Some banks, including Deutsche Bank, have already banned the use of WhatsApp.
Ben Rose, a founding partner at Hickman & Rose, added that any illegitimate communication is unlikely to be made over company phones. “If someone uses WhatsApp for an unlawful purpose then, if they have their wits about them, it seems unlikely that they would use their work phone,” he said.
BlackBerry has reinvented itself as a software and security company to supply corporate and government customers. The software works across all phones not just the small number of BlackBerry handsets still in use.