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All broker-dealers are thinking about which employees might be able to work from home, as suggested by the Financial Industry Regulatory Authority.
Even with increased telework, brokers and dealers need to be informed and proactive to work with clients, market needs and regulators as more information continues to be released and reported.
What exactly should broker-dealers be prepared for?
- Pandemic-related continuity planning needs.
- The flexibility of existing business continuity plans.
- How current pandemic concerns and issues may affect existing or future needs of business continuity plans.
FINRA provided these advisory’s in relation to member firms to ensure their continuing ability to meet their existing obligations to customers and relationships to other broker-dealers.
They are advised to conduct their own risk analysis to determine where critical impact points and exposures exist within the firm and their counterparts.
As I read these recent advisories to brokers-dealers, I wondered about their small and midsize business clients.
Don’t these same concerns broker-dealers have been advised about by FINRA — ensuring they are able to meet existing obligations to customers — apply to the owners of the broker-dealers’ small-business clients in relation to their families, key employees and customers?
These small businesses have three basic options when an untimely or unexpected illness or death occurs (or a pandemic-related event that disrupts the very fabric of their business):
- Keep it.
- Sell it.
- Liquidate it.
This article isn’t a “Planning Business Continuity” primer, it’s a question.
In today’s economy, for example, the impact of the loss, short-term or permanent, of a key employee is becoming a critical question.
The very same questions and advisory FINRA is giving broker-dealers are the things broker-dealers should and must take to their existing clients and the marketplace.