What You Need to Know
- Compliance teams must remain hyper-focused on taming the risks associated with employees continuing to lean heavily on work-from-home platforms.
- Firms should embrace the cloud, just as FINRA and the SEC have done.
- Regulators are increasingly using a host of machine learning tools to their advantage.
Even as many wealth management firms and banks want staff back in the office, work-from-home models will endure, especially as the delta variant forces many businesses to reassess previously announced plans.
Because of that, compliance teams will have to remain hyper-focused on taming the risks associated with having hundreds, if not thousands, of employees continuing to lean heavily on these platforms to do their jobs.
Indeed, we are likely to see more reviews, greater enforcement and heightened consequences for firms with data retention policies and procedures that fail to keep pace with these shifting times.
The irony is that as many firms continue to rely on legacy systems to handle their burgeoning compliance responsibilities, the entities that regulate them are as technologically proficient as they have ever been.
Playing Catch-Up With Regulators
What many in the industry may not appreciate is how tech-savvy the regulators themselves have become. Executives, in fact, are frequently shocked to discover the extent to which FINRA and the SEC leverage technologies that many of their own firms are not using to the same degree.
As a result, an innovation gap exists between countless firms clinging to an era when email was the only digital form of communication and regulatory agencies, which have adopted cutting-edge tech far more quickly.
For many in the industry, this disconnect is a recipe for data retention and oversight disaster. The fallout is millions in fines and myriad other legal and compliance penalties.