For hedge fund managers, mobile devices present benefits and risks. On the benefit side, mobile devices enable employees to perform their jobs more efficiently – they reduce the relevance of geography and save considerable time. But on the risk side, mobile devices create innumerable small cracks in the wall separating a manager’s confidential data from unauthorized use of that data. Unfortunately for managers that globally determine that the risks outweigh the benefits, there is no realistic way to avoid confronting mobile devices. Such devices have become an integral part of professional life in the service economy, and they play a particularly central role in information-driven businesses like hedge fund management. Accordingly, the question for hedge fund managers is not whether to implement and enforce mobile device policies and procedures, but how. This is the second article in a three-part series designed to answer this question. The first article in this series made the “case” for the importance of mobile device policies and procedures for hedge fund managers. It did so by illustrating the myriad risks imposed on a manager by the absence of such policies and procedures, including susceptibility of critical information to leakage or theft, unauthorized trading, penetration of systems by malware and viruses and other potential detriments. See “What Concerns Do Mobile Devices Present for Hedge Fund Managers, and How Should Those Concerns Be Addressed? (Part One of Three)
,” Hedge Fund Law Report. Vol. 5, No. 15 (Apr. 12, 2012). This article explains how hedge fund managers can anticipate and address those risks using policies, procedures and technology solutions. This article starts by identifying three suggested steps that hedge fund managers should take before crafting their mobile device policies and procedures. The article then makes specific recommendations regarding the content of mobile device policies and procedures. As is evident in the discussion in this article, policies, procedures and technology are inextricably linked in this context, and effective policies and procedures must be informed by a thorough understanding of the relevant technology. This article, accordingly, intersperses the legal and compliance discussion with a detailed description of available technology solutions.