Is your financial institution compliant when using video chat?

June 28, 2022 Windstream Enterprise 5 min
The question of whether video communication platforms are secure often gets overlooked in the desire to quickly go digital. But in an industry where cyber risk management is a top priority, security and compliance are critical.

The past few years have seen a significant shift toward working and meeting online, and the financial services industry is no exception to this trend. Online video chat platforms offer a quick and convenient way to work closely with clients without physically sitting in the same room. But while meeting online may be easy, it’s important to take steps to ensure your virtual meetings are fully compliant with all laws and regulations. 

A recent Windstream Enterprise survey of financial industry leaders found that 34 percent of banks and credit unions use live video chat to interact with customers online. If you are already working with customers through a video platform or are considering doing so in the future, here’s a look at what financial institutions should be thinking about when it comes to compliance and customer video calls. 

How financial companies use video chat with customers 

Omnichannel communications are an important part of the banking system. According to the Windstream Enterprise survey, 41 percent of financial companies said they use email very often, followed by video conferencing (34 percent) and live chat (28 percent). Both physical bank branches and call centers can benefit from including video conferencing and chat capabilities.

Imagine a highly valued customer has a quick question for her favorite banker. In the modern era, this customer would rather meet face-to-face but doesn’t want to worry about the health risks or travel time of visiting the branch. Rather than pick up the phone and call, this customer prefers to discuss their account question over a video call.

Your employees may quickly turn to a video conference app they know from personal use. While video chats are convenient and easy for the customer, financial institutions are under a greater burden of security and privacy than most other industries. Institutions should ask: Are these video communication platforms secure? That’s a question that often gets overlooked in the desire to quickly go digital. 

Company leaders need to be cautious around security and compliance concerns when rolling out video communication technologies for the first time. 

In the same survey, C-suite executives with 72 percent indicating that this is a critical area for their business. At the same time, 70 percent said that attracting and retaining digital customers is also a top priority. These twin priorities need to be addressed in balance.

The customer experience (CX) imperative predicts continued growth in video chat for financial services businesses. Still, leaders need to be cautious due to security and compliance concerns when rolling out these technologies at their companies for the first time. The right video solution to use in the highly regulated financial services industry is one that is both secure and customer friendly. 

Compliance for financial video calls 

Here are a few specific rules and regulations that have implications for video conferencing for financial companies:

  • Gramm-Leach-Bliley Act: This law requires financial companies to share information-sharing practices with customers and safeguard sensitive customer data.
  • Equal Credit Opportunity Act (ECOA): This act’s non-discrimination requirements apply to interactions by video, as well as those in person.
  • Bank Secrecy Act: Large and suspicious transactions don’t have to occur in-branch to fall under this law’s reach. Many records around certain transactions must be maintained for up to five years regardless of how the transactions are made.
  • Interagency Guidelines Establishing Standards for Safety and Soundness: This regulation includes several components requiring strict operational and managerial standards for internal controls and information systems and follows safeguards to protect the security, confidentiality and integrity of customer information.

There are real consequences to violating legal and compliance guidelines in the financial services industry, and whether or not the violation was intentional doesn’t matter. The Gramm-Leach-Billey Act carries potential institutional fines of up to $100,000 per violation. Additionally, officers and directors of the violating institution can be found personally liable in certain circumstances and could face fines of up to $10,000 per violation––or even prison. And in a case that is very relevant for financial institutions considering how employees communicate with customers, JPMorgan was recently fined a record-setting $200 million for allowing employees to use WhatsApp in order to evade federal record-keeping requirements. 

In addition to these compliance guidelines, financial institutions also need to consider whether to record all video chat sessions in order to review them for compliance and service quality. These recordings must of course be stored securely to avoid potential exposure of sensitive customer information.

As you know, banking security laws can be complex. Work with a trusted legal advisor or in-house counsel to ensure you stay compliant with any regulations that apply to your business. Your company may fall under additional rules from the FDIC, CUNA, SIPC, FINRA or other regulatory bodies.

Cybersecurity risks when using video for customer interactions 

The uptick in companies over recent years using video conferencing software caused a surge of “zoombombings.” Uninvited pranksters or hackers able to log in to meetings compromised private information shared among participants. While these intrusions aren’t often directly targeted to financial institutions, security risks like these are a serious concern. 

82 percent of survey respondents use three or more applications or programs to have an up-to-date, complete view of their customers.

Federal agencies and industry groups emphasize customer privacy and security when crafting regulations and rules. The Federal Trade Commission (FTC) offers advice to keep video conference calls private—such as password protecting meetings, locking out uninvited participants, establishing video communication best practices for employees, and updating video conference software—among other resources. Sharing the FTC’s tip list with your employees can be a good step towards making video call privacy easier for everyone.

It’s worth noting that while video and other electronic communications are used frequently, only 17 percent of respondents in the Windstream Enterprise industry survey stated that unified messaging was used very often. In contrast, 82 percent of respondents said they use three or more applications or programs to have an up-to-date, complete view of their customers.

With so many customer touchpoints, it’s easy to commit a minor violation of law (VOL) accidentally. Consider consolidating your business applications into a unified communications platform to reduce these sorts of potential problems. When you follow a clear security and compliance strategy across all electronic platforms, you’re in the best position to remain compliant, avoid data breaches or fines and offer the best customer experience.

Growing opportunities for video in customer service 

Video-based calls are a daily reality for many customers when chatting with family and friends. They expect their bank, credit union, mortgage lender, credit card company and any other financial institution they use to follow suit. If you’re not already, it’s now time to lay a solid and secure foundation for video interactions with customers as an additional standard way of doing business.

Forward-thinking financial services companies must offer the convenience of video chat, and it’s possible to do so with security and regulatory needs confidently met. 

When you work with a trusted partner like Windstream Enterprise, you can get up and running with the ideal solution for your employees and customers.

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Key Takeaway
The right video solution to use in the highly regulated financial services industry is one that is both secure and customer friendly, and that is part of a clear strategy across all digital platforms.

A roadmap: Digital transformation for banks and credit unions