In Regulatory Wrap for the week to April 12, Rob Mason discusses the theme of transparency with financial regulators, including the SEC’s explanation about the trigger factors that lead to investigations.
In this Regulatory Wrap, we outline the considerations that the Securities and Exchange Commission (SEC) weigh when deciding if a firm will be pursued for recordkeeping violations. This comes after a recent announcement from the Financial Conduct of Authority (FCA) stating that it will “name and shame” firms in effort to deter noncompliance.
1. An individual assessment will be carried out against a firm to determine if the planned fine amount is appropriate based on the scope of violations, sum of off-channel comms instances, and number of employees involved
2. The SEC will also consider mitigation steps a firm has taken, such as the degree to which it has complied with other regulations, if it has implemented compliance solutions, and whether repeat offenders have remedied processes following enforcement actions
3. Firms are encouraged to self-report upon discovering recordkeeping violations to demonstrate their cooperation and accountability
4. Similarly, the FCA has pushed for increased transparency with its new “name and shame” approach meant to deter noncompliance
5. In response, firms must deliberate how to strengthen their defenses and take accountability to adhere to increasing transparency requirements
This Regulatory Wrap is brought to you by Global Relay’s Director of Regulatory Intelligence, Rob Mason.
To meet the transparency requirements that financial regulators are demonstrating and requiring of firms, it is as important as ever to implement compliance solutions to capture and monitor communications.
