IMlogic Helps Hedge Funds with IM Compliance

 
 
By Theresa Carey  |  Posted 2004-11-04 Email Print this article Print
 
 
 
 
 
 
 

To help advisers meet new SEC regulations, the company's Quickstart Pack includes a host of tools to help secure, manage and archive all electronic communication, including instant messages.

The U.S. Securities and Exchange Commission (SEC) imposed new regulations late last month on private investment pools, also known as hedge funds. The ruling requires that most hedge fund advisers register with the SEC under the Investment Advisers Act of 1940, which includes provisions for securing, managing and archiving all electronic communication, including instant messages. The use of IM in financial trading is widespread, thanks to its real-time communications capabilities in a time-sensitive industry. When theres news that can move markets, traders often zap instant messages to their clients rather than trying to track them down on the phone or send e-mails. A trader also can push an IM out to a group simultaneously rather than trying to juggle multiple phone calls. With IM adoption expected to grow within hedge fund and other financial services firms, compliance officers and IT managers in these organizations will need to manage IM within a comprehensive compliance and archiving framework. Instant messaging communications are specifically included in SEC regulations as a form of electronic communication, and as such must be managed in a way that is consistent with existing e-mail policies.
Click here to read about Microsoft adding voice and video to its IM client.
Having been relatively free from regulatory oversight until now, many hedge fund firms may find themselves unprepared to meet the new SEC regulations pertaining to IM. The rules require registered financial advisers to archive their IM communications. Some companies have barred the use of public IM services such as AOL Instant Messenger or Yahoo Instant Messenger, mainly for security purposes and also so their traders appear more professional. Would you take a trading tip seriously from someone who shows up on your screen as TheBigDog, or would you prefer to chat with Geoffrey Jones?
Solutions available today, such as the Bloomberg messaging system, can be used to convey market information and to trade ideas back and forth. Bloomberg requires proprietary hardware, though, and is more suitable for an in-house system. Next Page: Reuters Messaging and IMlogics starter package.



 
 
 
 
Theresa is the Editor of CIOInsight.com's Finance Industry Center. She's been writing about financial technology issues since 1990 for a wide variety of publications, including PC Magazine, Newsweek, Fortune, and Fortune Small Business. She is also a Contributing Editor to Barron's and writes their 'Electronic Investor' column.

Theresa received a B.A. from the University of California, Berkeley, and a M.S. from the University of Santa Clara. She also has a private pilot's license. When she's not at her computer, she coaches a local high school volleyball team, plays softball and volleyball, and takes part in many Cal Alumni Band events. She lives in Northern California.

 
 
 
 
 
 
 

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