Chief Compliance Officers in the investment industry face a tall task these days. One of the most aggressive SEC regimes in recent history is flexing its muscles to put CCOs and their senior management on notice. The SEC is pursuing a high octane combination of increased examinations bolstered by numerous rulemaking initiatives sure to keep compliance professionals busy over the next decade. It’s no wonder CCOs are reaching for the Tums inside their desk drawer. FrontLine Compliance Founder and President Amy Lynch commented in a recent IGNITES story that the industry has gotten “the hint, and they realize that they need to be prepared.” In fact, SEC mock exams conducted by firms are on the rise, and a recent survey of compliance professionals bears that out. Some common areas of focus for mock exams, notes Ms. Lynch, are custody, side letters, conflicts of interest and private funds. She adds that the first step in ensuring the correct preparation approach is to identify regulatory risks. A risk assessment conducted by an outside compliance consultant becomes the basis to formulate a plan for testing a firm’s compliance, a crucial component in preparing for a SEC exam. It also goes a long way toward reducing the SEC exam anxiety many CCOs are feeling today.
View our ComplianceAlert, “SEC Pursues its Regulatory Agenda”
Request our complimentary white paper, “SEC Exam Interview Tips”
