Background
An investment adviser was in the midst of a SEC audit. The audit had been consuming significant amounts of time. It was clear to the firm and the SEC that the investment adviser would need to revise or create new compliance policies and procedures. The Chief Compliance Officer contacted FIC indicating that his firm sought a review of the firm’s procedures and enhancements to such procedures.
Our Methodology and Processes
FIC conducted an introductory call with the Chief Compliance Officer about the firm’s processes, policies, and actions being undertaken. A copy of the firm’s existing procedures then forwarded to FIC for review. The initial review revealed significant changes were necessary. The procedures did not reflect changes in regulations, did not address adequately address activities and risks, and conflicted with many of the practices that were taking place.
FIC communicated to the Chief Compliance Officer that substantial changes were necessary. The firm and FIC determined the best course of action was to rewrite the entire procedures versus amending them. FIC continued to seek feedback and answers as needed as well as provided guidance on best practices and various alternatives for achieving compliance with applicable regulations. FIC created an inventory list of all applicable regulations as well as risks, conflicts of interests facing the investment advisor, and methods to address these.
Results
FIC provided the investment adviser new compliance policies and procedures within a month of beginning work on the project. The compliance policies and procedures addressed applicable regulations, current business activities, and addressed various risks and conflicts facing the investment adviser and its representatives. The compliance policies and procedures provided a solid foundation for the firm going forward as evident by the firm’s continued use of the compliance policies and procedures subject to a few amendments for rule changes since then.
How Can FIC Help?
FIC customizes procedures for the needs, desires, and practices of our clients. We understand that business types, policies, and practices may widely diverge. We do not believe in the adage “one size fits all”. Further, our design, format, and organization of the procedures allow for flexibility to add additional policies in the event of changes within your business or related to regulations. When you choose to utilize our firm for the creation and development of procedures, you can have the confidence that the procedures are tailored to your business and will provide a solid foundation.
We offer variety of options for broker/dealers and investment advisers. Firms can request:
- New policies and procedures addressing all aspects of the firm and regulations
- Policies and procedures addressing specific areas of regulations and business activities
- Periodic updating services whereby FIC will quarterly update a firm’s policies and procedures for changes in regulations and changes requested by the firm
- Annual or other than annual reviews of the firm’s policies and procedures based on the scope of the engagement