1. Introduction
1.1 Who should read this practice note?
Managing partners, practice managers and any staff concerned with the management and day to day operations of practices.
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1.2 What is the issue?
The Financial Services Authority (FSA) has introduced new record keeping requirements for mortgage arrears handling. As a result, some practices may need to introduce call recording. This practice note advises on how to comply with the relevant legislation on recording calls.
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2. Mortgage arrears handling: new requirement
The FSA's new requirement is as follows:
' From 25 December 2010 , if you call a borrower on behalf of a lender or Third Party Administrator (TPA) to negotiate repayment terms and/or forbearance options, you will need to record that call. You will therefore need to make the necessary arrangements for this to happen and for records to be retained by or readily accessible to the lender and/or TPA. Records must be kept for three years from the date of the call.'
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3. Recording calls: legislative framework
If you monitor and record telephone calls you must comply with the Regulation of Investigatory Powers Act 2000 (RIPA), the Telecommunications (Lawful Business Practice)(Interception of Communications) Regulations 2000 (SI 2000/2699) (the LBP Regulations) and the Data Protection Act 1998.
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3.1 RIPA
RIPA makes it an offence to intercept a communication in the course of its transmission by means of a public telecommunication system.
If you record telephone calls so as to make them available to a third party you are intercepting those calls.
However, interception is lawful if both the person making the call and the person receiving the call have consented.
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3.2 LBP Regulations
The LBP Regulations set out further circumstances in which interception by way of call recording is lawful. These include:
- establishing the existence of facts
- ascertaining compliance with regulatory or self-regulatory practices or procedures
- monitoring the performance standards of staff
You should consult the LBP Regulations and must identify a lawful basis for your call recording. If you are call recording in order to meet FSA requirements this is likely to fall under the exemption for regulatory practices and procedures.
A further requirement of the LBP Regulations is that you have made all reasonable efforts to inform every person who may use your telephone system that calls are recorded.
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3.3 Data Protection Act 1998
Telephone calls will contain personal data. Its processing is subject to the provisions of the Data Protection Act 1998. This requires you to:
- identify who you are and your purpose for processing personal data; not to process it for other incompatible purposes
- keep personal data secure and not to retain it for longer than is necessary
A further requirement of the LBP Regulations is that you have made all reasonable efforts to inform every person who may use your telephone system that calls are recorded.
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4. Getting consent to record a call
If you are relying on consent in order to record a call, the Information Commissioner's Office (ICO) has advised that 'there must be some action from which consent can be inferred, for example, the caller saying "yes" when asked or proceeding with a telephone call after hearing a message saying that calls are recorded'. The ICO has also pointed out that consent must be freely given.
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5. Measures to help compliance
To help your firm comply with the regulations on call recording, you should:
- appoint a named senior person to take responsibility for compliance of your call recording operations
- document how your practices and procedures comply with the requirements of RIPA, the LBP Regulations and the Data Protection Act;
- consider how you will provide your staff with the opportunity to make unrecorded personal telephone calls
- consult the Law Society's data protection, information security and business continuity practice notes and follow their best practice recommendations
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6. Statutory provisions
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7. More information
7.1 Status of this practice note
Practice notes are issued by the Law Society as a professional body for the benefit of its members. They represent the Law Society's view of good practice in a particular area. They are not intended to be the only standard, nor do they necessarily provide a defence to complaints of misconduct or of inadequate professional service. Solicitors are not required to follow them.
They do not constitute legal advice and, while care has been taken to ensure that they are accurate, up-to-date and useful, the Law Society will not accept any legal liability in relation to them.
For queries or comments on this practice note contact the Law Society's Practice Advice Service.
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7.2 Terminology in this practice note
Must - a specific requirement in the Solicitors' Code of Conduct or legislation. You must comply, unless there are specific exemptions or defences provided for in the code of conduct or relevant legislation.
Should - good practice for most situations. If you deviate from this, you must be able to justify why this is appropriate, either for your firm, or in the particular retainer.
May - a non-exhaustive list of options for meeting your obligations. Which option you choose is determined by the risk profile of the individual firm, client or retainer. You must be able to justify why this was an appropriate option to oversight bodies.
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7.3 Other products
7.3.1 Practice notes
7.3.2 Law Society publications
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