Just in time for hurricane season, the Securities and Exchange Commission, Commodity Futures Trading Commission and Financial Industry Regulatory Authority told firms in an advisory Friday the steps they should take to implement effective business continuity and disaster recovery plans.
The jointly released advisory follows a joint review by the regulators in the aftermath of Hurricane Sandy, which caused widespread damage to Northeastern states and closed U.S. equity and options markets for two days in October.
The SEC, FINRA and CFTC say they contacted firms with a significant market presence to gain an understanding of how the firms were impacted by the events surrounding Hurricane Sandy; specific emphasis was given to business continuity plans and disaster recovery procedures.
The SEC’s Office of Compliance Inspections and Examinations (OCIE), the CFTC’s Division of Swap Dealer and Intermediary Oversight, and FINRA issued the advisory to encourage firms to review their plans so as to improve responses to and reduce recovery time after significant large-scale events.