Regulatory Wrap Episode 6: The Crucial Role of Leadership in Compliance

In Regulatory Wrap for the week to September 22, Jennie Clarke poses the question – what role do leadership and “tone from the top” play in promoting compliance?

22 September 2023 2 mins read
by Kathryn Fallah

In Regulatory Wrap for the week to September 22, 2023:

In this Regulatory Wrap, we recount the range of regulatory fines that involve senior leaders and executives and the actions certain firms have taken to combat this misconduct. These occurrences bring to light an ongoing issue in the industry, which is the challenge of enforcing compliance amongst those who are trusted to set an example of appropriate behavior for employees.

Highlights:

1. It’s been almost a year since the Securities and Exchange Commission (SEC) charged 16 Wall Street firms for failing to preserve electronic messages, which involved senior executives

2. Morgan Stanley was one of the charged firms, which has since issued financial penalties to off-channel comms offenders

3. Goldman Sachs, which was also charged by the SEC, announced it has dismissed four executives for communication policies violations (including its head of transaction banking)

4. As regulators come down on bad actors and emphasize leading by example, it is beneficial to employ tools that detect and prevent misconduct before it becomes a bigger issue

5. Firms should consider the best approach to promote compliance amongst all levels of staff at their organization and how they can effectively deal with misbehavior

This Regulatory Wrap is brought to you by Global Relay’s Head of Content, Jennifer Clarke.

Global Relay has a suite of compliance tools to help you meet recordkeeping requirements and mitigate the risk of being next on regulators’ radar.