Woodlands Securities
Software Helps Keep Company – and Employees -- Compliant

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The Setting

In The Woodlands, Texas – a city of approximately 60,000 residents about 20 minutes north of Houston – Woodlands Securities Corporation operates as a “fully disclosed broker/dealer composed of highly trained, experienced financial consultants.” The business is one of five associated financial services companies, including Woodlands Financial Services, Inc., The Advanced Financial Group, Integrated Benefits Solutions, and the Jim C. Harris Company.

In addition to financial service commonalities, the companies also share one Network Administrator in Dennis McCullough. McCullough tends seven network servers and nearly 60 desktop and laptop computers across the five companies. Six of the servers operate Windows 2000 Server while one runs Windows 2003 Server. The desktops and laptops run a mix of Windows 2000 Pro and Windows XP Pro.

Employees at the five businesses, according to McCullough, are “very business professional.”

“There’s a good work ethic at all of the businesses,” said McCullough. “Whatever is laid down as law, that’s what happens.”

The Challenge

Similar to any company involved in the buying and selling of stocks, bonds, and other financial instruments, Woodlands Securities is overseen by three key regulators: the National Association of Securities Dealers (NASD), the Securities and Exchange Commission (SEC), and the State Securities Board.

“As a broker-dealer, we are required to review all electronic correspondence and maintain that correspondence for three years,” said Laura Hendricks, in charge of compliance at Woodlands Securities.

To conform to established regulations, broker-dealers not only must monitor incoming and outgoing emails and other forms of electronic communication such as instant messages, but they also need to have a reliable method of archiving the information. In the words of one industry analyst, NASD and SEC compliance has come down to two words: “apply technology.”

In the words of another financial services pundit: “What once was good business sense is now a legal requirement.”

Search for a Solution

McCullough’s need for a monitoring capability was simple. There were no complaints from management about inappropriate Internet surfing, no concerns about game-playing on company time, no whispers of clandestine love affairs being conducted via email or instant messaging. Woodlands Securities, as well as the balance of the five companies served by McCullough, was driven by industry regulations first, last, and foremost.

“The rules and regulations of our industry require us to keep a log of all incoming and outgoing emails,” said McCullough. “Before we found a better way, we used Microsoft Outlook’s ‘rules’ to audit emails. That was the way we kept track of emails then, and tracking email still is the main consideration today.”

McCullough said that in searching for a program to better serve his company’s needs, he first polled others in the securities industry and found much of what was being used and offered cost “tens of thousands of dollars.”

“Also, those programs were very involved,” said McCullough, suggesting that while perhaps amply featured, they were largely overkill for the needs of Woodlands Securities and its associated enterprises.

Enter SpectorSoft PC activity monitoring software, as seen by McCullough in PC Magazine, considered by many to be the “bible” of all things related to the personal computer.

“I did a couple of tests and demos,” said McCullough. “I found Spector CNE to be what we needed, both in features and pricing.”

Discoveries

Because his search for activity monitoring software was the result of industry requirements and not driven by inappropriate PC use, McCullough said surprises have been few and far between. Sometimes just one incident, however, is enough to make a significant mark.

“All we did was monitor email until something came to our attention,” said McCullough. “An employee saw something on another employee’s monitor that shouldn’t have been there.”

McCullough said that as a courtesy, he spoke to the person responsible and suggested he “stop going there.” The individual, however, chose to be defiant, and continued to access the off-limits site.

“That person is no longer with us,” said McCullough. “Continuing to do that even after a warning is amazing … it’s unreal, is what it is.”

Awareness

At one of the five companies McCullough serves, just the realization that email monitoring is occurring is enough to give employees pause.

“They come to me and tell me about their activities,” said McCullough. “Things like ‘I’m checking my bank statement online … is that OK?’”

Working With Employees

In four of the five associated companies, McCullough said employees were notified of the existence of Spector CNE and its monitoring capabilities through an official email. In addition, at these facilities, McCullough takes advantage of the software’s optional logon notice that alerts users the computer is being monitored.

“Overall, the policy is ‘do not access the Internet for personal use,’” said McCullough. “We say it is ok to use PCs for personal use at lunchtime. And at one office there is an area that serves as a break room. In it, there’s a PC and it is considered acceptable for personal use, once again, only at lunchtime.”

Employees were not expressly informed about the monitoring software at one facility where management is out of the office much of the time. “It was felt there was more potential for abuse in that environment,” said McCullough.

Spector CNE: The Software of Choice

McCullough believes Spector CNE has been a boon to Woodlands Securities and its associated companies in general, and to his network administration duties specifically.

“Spector CNE has made a big difference all around,” said McCullough. “The price of most of the other industry compliance solutions was way out of our range. At one point I said ‘what are we going to do now?’ But I called SpectorSoft and started talking to the sales department and found that their products were full-featured and well within our budget.”

McCullough also finds that Spector CNE lightens his personal workload.

“It’s a lot easier for me to administer the network,” said McCullough. “With Spector CNE I can just go and look into the Control Center. It’s a lot easier to manage than I thought. Even the install and pushing out the program to the workstations was easy. I thought it would be more involved.

“I was especially impressed with the install notes and alerts along the way. I felt it was very well thought out … items of potential concern were brought to my attention before I had a chance to get into trouble.”

	McCullough especially appreciates Spector CNE’s ability to set up a terminal session with his servers, enabling him to push out the Spector CNE program to remote laptops.
	“Time to learn the program was quick,” said McCullough. “How quick? How about from 10 to 11 AM?”

When it comes to return on investment, McCullough said Spector CNE’s impact was nearly immediate.

“In my opinion, just catching that one person is enough,” said McCullough. “At that point it pays for itself. That one employee was on non-business sites all day long.

“Just one employee caught at one company paid for all 65 licenses at all five companies. Spector CNE is doing a lot … all we bought it for, PLUS.”

For more information about Woodlands Securities, please visit www.woodlandssecurities.com.

For more information about Spector CNE, please visit www.spectorcne.com … or for more information about SpectorSoft and its other dependable, full-featured PC and Internet Activity Monitoring Software products, please visit www.spectorsoft.com.

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