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Mobile Compliance

Blackberry Making A Comeback

BlackBerry is alive and kicking. BlackBerry said that KPMG’s Italian operations have ordered 3,500 BlackBerry 10 devices and have committed to using BlackBerry Enterprise Service 10 to manage its mobile devices.

BlackBerry acknowledges that BB10’s adoption rate has been slower than expected, though that may be an understatement: of the 5.9 million phones it sold between June and the end of August, 4.2 million were devices running BlackBerry 7, its old operating system. Blackberry 7 remains far more successful. Blackberry 7 phones are 72% of their sales. They can’t afford to stop selling them.

The new BlackBerry Z30 comes with a five-inch screen, improved battery life and faster processor than the models released earlier this year. BlackBerry says the Z30 will be stocked by other Canadian carriers, including Bell and Telus, as well as retailers like Best Buy and Future Shop. Prices will be set by the various retailers.

Blackberry Z30 is ideal for business as blackberry has always been. The QWERTY keyboards and emphasis on email and messaging meant that IT departments fell in love with the company as it was ideal for the mobile worker. The BlackBerry Z30 is a device that is well suited for business users. BlackBerry Enterprise backs up the BB Z30.

BlackBerry’s secure enterprise network holds the most value for a potential buyer in the smartphone industry. The enterprise market is however seeing companies increasingly being open about employees bringing their own devices to work. BlackBerry could still benefit from having a large installed BES base with a proven mobile device management software that now has cross-platform support.

Lenova is considering a purchase of Blackberry, adding that the firm has signed a non-disclosure agreement to look at the smartphone maker’s books. It is unclear if Lenova’s primary interest is in BlackBerry’s hardware or software expertise. Lenova would consider an acquisition to boost its presence in the US.

Enterprise Is The New Niche Market For Galaxy Smartphones

Enterprise Smartphones

Samsung introduced the Galaxy S4 in March. What most people don’t realize is there are actually five Galaxy S4 models. There’s the standard 5-inch model, the 4.3-inch Mini, a ridiculously almost tablet sized 6.3-inch called the Mega, and an elite camera phone named the Zoom. Last, but certainly not least, there is the Galaxy S4 Active, a water-resistant model that makes all other smartphones feel vulnerable to any/all types of damage.

Divide and conquer is the current strategy of smartphone makers. Not so long ago, all were amazed and jealous by the magnificent iPhone. Manufacturers were forced to turn to niche markets, where there are fewer competitors and customers are more likely to pay a bit extra for an expensive new gadget. Some tangential markets have yet to be really explored. The decline of Blackberry has left a gaping hole for enterprise compliant devices. Businesses have embraced the iPhone and Android devices. Currently Apple is a consumer facilitating company, unlikely to embrace the business world’s inclination for email friendly keyboards, advanced security and close integration with company regulations and mandates. Android is unfortunately regarded as unsecured and Windows Phones is mostly limited to unattractive colored handsets.

This means there may be a window of opportunity for some new competitor; or for an old one to make a comeback. Who will rise to the occasion?

The Toll of Noncompliance

Noncompliance banking

New York, New York, September 13, 2013 – It’s no secret that many large US brokerage houses have come under scrutiny in the aftermath of the great recession, along with many of the practices that are blamed for bringing about the economic decline. As regulators continue to sort through the financial rubble and investigate these firms with a punitive eye, legal related expenses continue to amass at staggering levels.


According to today’s Wall Street Journal, in the past five years JP Morgan alone has run up a whopping tab of over $18 billion in legal related expenses. (Note: That’s $ billions – not $ millions). Facing at least seven separate investigations in areas ranging from trading oversight to mortgage bond sales to overseas hiring practices, the company continues to negotiate settlements with several different agencies, which still could lead to another $600 million in penalties. Bank of America and Citigroup, reported in the same article, face the same dilemma. In 2008 – 2012, each incurred legal related expenses  of $16.1 billion and $7.2  billion respectively. (WSJ: “Embattled JP Morgan Bulks Up Oversight,” Sept. 13, 2013).


In addition, with the SEC and FINRA now ratcheting up their regulations, it has become painfully clear to the financial industry that regulatory compliance is no longer a peripheral consideration, and measures must be taken to mitigate risk. To that end, according to the Journal, JP Morgan “plans to spend an additional $4 billion and commit 5,000 extra employees this year to clean up its risk and compliance problems, according to people close to the bank.” Without doubt, all financial firms are following suit, and corporate compliance departments are being granted greater autonomy and authority.


And contrary to the belief of many, “compliance” usually touches every employee in a company – not just its executives. For that matter, as an example, it may be easier and less conspicuous for a financial executive’s admin assistant to illegally divulge insider information than it is for an executive. For this reason and others, compliance policies need to be ubiquitous across the organization, clearly defined, well communicated, and enforceable, with the necessary resources in place to administer them. To be compliant comes at a cost, but in the final analysis, the investment may save a company from unexpected  fines, law suits and damage of reputation, which significantly out way the investment.

About MobileGuard


MobileGuard is the leading provider of mobile communications management solutions, and ensures compliance with all relevant regulatory bodies. MobileGuard’s patented solutions provide the monitoring, capturing, logging, archiving, and supervision of all communications on company mobile devices. MobileGuard’s mobile communication compliance solutions are provided as either a hosted platform or in the customer’s environment. To learn more, please visit

Phone: 646 459 4354

How To Address The Sunshine Law Text Messaging Issue

The general rule of the Sunshine Law is that every person has the right to inspect or copy any public record made or received in connection with a transaction involving official business by a public body.

Public records include all documents, regardless of physical form or characteristics, and are not limited to traditional written documents: emails, SMS messages, letters, memos, maps, books, and recordings, all fall under the definition of “public records,” as they are a record made or received in connection with transactions of official agency business.

In this context, any public official who uses his or her mobile phone to exchange SMS messages or emails with another official, or with anyone else, should have the communication logged and archived, and it should be available to the public upon request, according on the Sunshine Law.

From this perspective, when a message sent to/from a commissioner’s mobile device disappears, that person could be the target of criticism, as in the recent case of Orange County commissioners who are now subject to an investigation initiated by the Florida Department of Law.

The FL. Statute sec. 119.011(1) (1995) expansively defines “public record” to include: “all documents, papers, letters, maps, books, tapes, photographs, films, sound recordings, data processing software, or other material, regardless of physical form, characteristics or means of transmission, made or received pursuant to law or ordinance or in connection with the transaction of official business by any agency.

So how can we avoid these cases? The fact is, there are multiple solutions: One of the possibilities could be to forward county-related text to an archive, similar to the one established for commissioner email. Another could be to hold each board member personally responsible for saving those text messages.

Yes, either of the aforementioned solutions could work, but there is one more alternative. And if you are looking to comply with the Sunshine Law, the method the department adopts should aim to be totally transparent for both sides: the user and the public.

A third-party tool that monitors, stores and provides easy access to all text messages initiated and received on the mobile device could be the answer.

Importance Of Internal SMS Monitoring Justified by David Petraeus Scandal

Most Companies monitor their employees SMS messages on business owned cell phones as well as email messages legally.  It has become a standard procedure to stay compliant with many of the regulatory mandates by FINRA, HIPAA and the FSA. The importance behind mobile recording and monitoring text messages is to ensure compliance as well as prevention of nefarious communications. Companies use their business phones for personal use which can cost the company a significant amount of money,  not to mention insider trading or any other immoral actions that can be monitored via Email, SMS and MMS.

The private sectors understand the importance of cell phone surveillance and has found it to be a very effective way to thwart any communications which can compromise an organization and its reputation.

But what about the public sector?

Reports suggest that the  David Petraeus case was built off of the discovery of inappropriate e-mails and text messages. Jill Kelley, a close personal friend of Petraeus, received threatening e-mails from an anonymous account and she asked an FBI agent to do some email and text message spying.  The agent discovered that the messages were being sent by Paula Broadwell, Petraeus’s biographer, and had also found e-mail correspondence that revealed the true nature of Broadwell’s relationship with Petraeus.

david petreaus

But why was this process so long? Was it because the top officials are immuned from such things like email and SMS monitoring and are not required to backup their SMS messages?  Does the public sector not take monitoring seriously enough? Does the government only monitor specific people?

This complicated love scandal proves that having one’s  text messages  stored and monitored can be very invasive to the personal life, but it is also necessary to the proper functioning of an organization or business.  It is challenging to keep track of all employees and their activities, but mobile recording and monitoring makes it much easier.

Wall street has realized the importance of Mobile Monitoring, now it’s time for the government to take it a little more seriously.

What You Don’t Know About Mobile Hacking

Whatever programmed thoughts you have about your phone being safe as long as it stays in your pocket—erase them now. The truth is: it is relatively easy to hack into a phone, even if it is smart.

Today, phones aren’t just devices we use to place calls. We use them to transfer money from one bank account to another. We store passwords and personal information on them. We video chat, instant message, play games and more. We are always more attached to our phones than we think. Ever caught that nosy guy sitting next to you on the train catching a not-so-sneaky glimpse of what you were texting, reading or playing on your phone? You were really annoyed, (weren’t you?) even though chances are he had no idea of what you were actually doing.

Because phones are evolving to smartphones and able to do incredible things they weren’t able to before, we are depending on them more than ever. Of course, hackers know this. One easy way to hack into a phone involves only the art of deceit and nothing more. “For instance, a would-be hacker might call you and pose as the phone company saying they need to update your account and need your password. Or the hacker might get enough of your information to call the phone company and pose as you,” says Robert Siciliano, a McAfee consultant and identity theft expert.

In the case that you do get this type of call, remember that your mobile carrier will never call you to ask for a password, even if they are doing an “update.” The general rule you should follow is to never give out passwords or personal information via phone, unless you have actually called first to ask for an update of some sort.

Hackers also know that many carriers still use default passwords for the phones they issue and a good number of people just don’t know to change them. This makes their job super easy—they can simply look up default passwords provided by carriers and use them to their advantage.

The best precaution you can take is to change your password occasionally.

In the widely known News Corp. scandal, “the now-closed News of the World paid bribes to police and intercepted the voice mails of celebrities, politicians and crime victims.” (Aug16th, WSJ) It is extremely likely that these phone hacks intro voicemails involved easy access to default passwords of victims who hadn’t changed them on their phones.

More technically adept hackers may “get a bit of information about your account and send a phishing email purportedly from your carrier asking you to log in. At that point they will have your password and other sensitive information.”

Because smartphones allow applications to be run on them, hackers can easily attach malicious codes to these applications that are downloaded on a daily basis. The “safe-in-my-pocket” thoughts should disappear—your phone doesn’t even need to be seen to be hacked. Be cautious of the applications you download, especially if you’re an Android user. Publishers are allowed to download their applications right into the Android market, so be careful.

The bottom line is: Be cautious about the activity you conduct on your phone. Fewer purchases via a website from your mobile device, fewer risky downloads and more password changes today may mean fewer headaches tomorrow.



The Truth About Jailbroken Phones

The Truth About Jailbroken Phones

First, let me point out that is not illegal to 1. Jailbreak a phone, 2. Use a Jailbroken phone and 3.  Download a Jailbroken application from an app store like Cydia.

On July 26th, 2010 US regulators lifted the cloud of any uncertainty when they announced it was legal to unlock or “jailbreak” an iPhone. The US Copyright Office stated claimed there is “no bias for copyright law to assist Apple in protecting its restrictive business model.”

Jailbreaking an iPhone means hacking into the devices operating system, essentially allowing a user to run applications on the phone that were not necessarily approved by Apple and not available on the iTunes store as a download.

Apple claimed that it was illegal to “unlock” a phone but never took legal action against any of the developers who use jailbroken phones and jailbroken applications downloadable from sites like Cydia which is operated by Jay Freeman, more fondly known in the iPhone “Jailbreak” community as Saurik.

In 2009, The Electronic Frontier Foundation asked regulators to add jailbreaking to a list of explicit exemptions to the Digital Millennium Copyright Act’s anti-circumvention provisions. The Copyright Office agreed with EFF, concluding that, “while a copyright owner might try to restrict the programs that can be run on a particular operating system, copyright law is not the vehicle for imposition of such restrictions.”
Currently, over 10% of all iPhone users are using Jailbroken phones and jailbroken applications today and that number continues to rise every day.
It should be understood that this decision which applies to all smartphones, (not Tablets), does not require mobile device manufactures to allow unlocking or jailbreaking a phone, it just makes it legal to circumvent any controls put in place to block a user from doing it.
Regulators agreed that “the activity of an iPhone owner who modifies his or her iPhone’s firmware/operating system in order to make it interoperable with an application that Apple has not approved, but that the iPhone owner wishes to run on the iPhone, fits comfortably within the four corners of fair use.”
The one disadvantage of jailbreaking an iPhone is that is voids the warranty with Apple.  Apple has declared that presently it will not change this policy and will only honor warranties on non-jailbroken phones.
To gain access to the many jailbroken applications on the market, one must visit Cydia. The iPhone needs to be jailbroken in order to start using the applications and there are many freely available tools courtesy of the hacker group iPhone Dev-Team.


Another important fact to mention is that one can reverse a jailbroken phone by just flashing it back to the base IOS which is done by restoring the original device IOS. For more information on jailbreaking your Apple iPhone, click here.
It’s only a matter of time when businesses realize that using a jailbroken or unlocked Smartphone is not only NOT illegal, but it will be necessary to allow the best and brightest applications to run on the device getting the most widely used communication method in use today for both personal and business purposes. With Mobile Compliance solutions in place, the enterprise can still be protected from lost or stolen phones, as well as monitoring the activity on the Apple iPhone.   Additionally, since 95% of Information Workers use self-purchased technology for work, they will want the freedom to be able to decide what they are allowed to use on the phone they paid for!


BROKER’S WORLD: Morgan Stanley Smith Barney Brokers Text Away

BROKER’S WORLD: Morgan Stanley Smith Barney Brokers Text Away

NEW YORK (Dow Jones)–Morgan Stanley Smith Barney to its brokers: U can text now.

The rule change, delivered in a memo in late January, allows brokers with firm-managed BlackBerries to use them for texting. It was prompted by requests from staff in the field, said a spokeswoman from Morgan Stanley Smith Barney, the brokerage joint venture of Morgan Stanley (MS). It makes the company the only big brokerage to allow the practice.

About 2,000 advisers and managers have firm-managed BlackBerries and are affected by the policy. Morgan Stanley Smith Barney will keep a record of the texts, to comply with industry regulations that it retain all electronic messages for three years. The company also says it will use the same process it has in place to review its staff’s emails.

A Morgan Stanley Smith Barney broker based in the Midwest said he doesn’t expect to start texting with his clients, but since he only carries one phone, he’s happy to have an easier way to communicate with his wife.

“For me, it’s more about how can I be the most productive, and that helps a little bit,” said the broker, who requested that his name not be used.

Spokeswomen for Bank of America Corp.’s (BAC) Merrill Lynch, and UBS AG’s (UBS) UBS Wealth Management America said their companies don’t allow brokers to use company-issued mobile devices to text. A spokesman for Wells Fargo & Co.’s (WFC) Wells Fargo Advisors said the company doesn’t issue mobile devices to its financial advisers, and those who use their own aren’t allowed to text clients.

As forms of electronic communication multiply and become more popular, financial services companies are struggling to keep pace in terms of policies and regulatory compliance issues. With the growing influence of smart phones, as well as social networking sites like Facebook and Twitter, the industry has been debating how to help brokers expand the ways they can reach out to clients.

“I think there is a very keen interest in the industry right now on how firms can utilize different technology to engage in business communications,” said Joseph Price, senior vice president of the advertising-regulation division of the Financial Industry Regulatory Authority, Wall Street’s self-policing organization.

Morgan Stanley Smith Barney’s new policy could put it a step ahead of the curve. Dan Nemo, chief operating officer of TextGuard, a company that helps firms monitor and archive communications sent through mobile devices, said he has spoken to brokers who have been frustrated when they have received texts from clients, but couldn’t reply.

“The broker wants to communicate with the customer and client the way the customer and client wants to communicate with them,” Nemo said.

(TALK BACK: We invite readers to send us comments on this or other financial news topics. Please email us at Readers should include their full names, work or home addresses and telephone numbers for verification purposes. We reserve the right to edit and publish your comments along with your name; we reserve the right not to publish reader comments.)

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Apple iPhone IOS Enterprise Use and Mobile Compliance

iPhone Monitoring

With the increase,  (daily) into the enterprise marketplace, Apple’s IOS is missing a major feature prohibiting the use of iPhone’s as it pertains to the Electronic Communications Compliance rules and regulations for archiving and monitoring messages.  Presently, there is no way for a compliance solution like TextGuard to be able to capture the incoming and outgoing messages on the iPhone device.

Companies in every industry face many legal and regulatory challenges when it comes to electronically stored information (ESI) and messaging.  This does not change when that information is on a smartphone or PDA.  All US based companies are required to comply with the E-Discovery requirements of FINRA, FRCP as well as  Sarbanes-Oxley. Several industries impose additional complicated burdens due to sensitivity and risk. The financial services and healthcare industries face the most rigorous requirements and penalties for non compliance.

iPhone has been ranked as the most popular smartphone for both enterprise users as well as consumers.  In fact, the overall consensus is that with the exception of battery life, satisfaction is close to 100%!   However, don’t ask the legal department or compliance administrators at companies who have employees using their iPhones for work.  They continue to be challenged as to how to monitor and archive the SMS messages which are being sent to and from the device.

We continue to (try to) work with Apple in allowing the required API’s for developers / users as well as the carriers who will also benefit from a mobile compliance solution for the Apple iPhone.  Please contact me if you would like to be informed of any updates as things progress.

Mobile Voice Communication Now Regulated

On November 11, 2010 the Financial Services Authority, “FSA,” produced final rules regarding the use of mobile phones for business.  Consultation Paper, CP 10/7, Taping:  Removing the Mobile Phone Exemption, explicitly states that company used mobile phones must be recorded and stored.  After a number of financial scandals that have rocked the financial services industry, the FSA has finally taken action.   This new change will apply to banks; stockbrokers; investment managers, including hedge fund managers; financial and commodity derivatives firms.[1]

The FSA did take the objections by financial firms under consideration, and as a result, firms will have a year to comply with the new standards and to develop policies and procedures reasonably designed to prohibit the use of non-company issued mobile phones for business purposes.  In addition, the FSA recognizes that firms will need to store huge amounts of data and as a result they limited the record retention time frame of the communications to 6 months.  It is important to note that financial firms will need to determine if their business models require them to be subject to the FSA’s mobile taping rule requirements.

Firms are going to need to conduct a risk assessment and determine who uses company issued mobile devices.  The next issue will be how can companies develop reasonable policies and procedures designed to prevent the use of non-company mobile phones for business purposes?  One way to accomplish this is by having all personnel sign a statement of understanding acknowledging that they have read the new policies and procedures, understand them, and attest that they will not use non-company assets for business purposes.  Within the procedures, firms must explain where these attestations will be maintained and how the policies and procedures will be tested.  If firms use an outside vendor for mobile compliance, the firms should get a statement from the vendor that the data is stored in a write once read many type format and that the vendor has policies and procedures reasonably designed to protect the integrity and security of the data.

Mary Schapiro, the Chairman of the Securities and Exchange Commission, “SEC,” and Lord Turner, the Chairman of the FSA held meetings on November 15th to discuss cross border regulatory co-ordination.  As more scandals are uncovered and the individuals prosecuted, regulators will push to gain access to more information.  Since the technology exists and the need for such regulation exists, it is only a matter of time before the SEC and State Securities regulators are pushing for similar rules and regulations regarding the use of mobile phones for business purposes.