Compliance Takes Center Stage at Wealth Management Conference

When it comes to the ever-changing compliance environment, "Business as usual is not an option," said Robert MacGraw, Director of Financial Services at the New Jersey consulting firm, Paragon Solutions. MacGraw moderated a panel discussion on compliance at a wealth management conference hosted by Wall Street & Technology Wednesday in New York City.

As the industry focuses on new and old regulations in the marketplace, panelist Jay Cohen, chief compliance officer of Dun & Bradstreet, stressed the role technology plays in fulfilling government regulations. Whether it is implementing packaged portfolio management software for pre-trade compliance or archiving mountains of e-mail, "technology is an expectation" of the regulators, he said. He urged compliance and IT leaders to know best practices of an industry, because if a technology is available to spot a problem but a company isn't using it, regulators will want to know why.

Cohen added that the key trends in compliance space today are integrating these initiatives into risk management and compliance reporting for an increase in return on investments, establishing a strong operations baseline for continuous improvement, and focusing on improved controls and oversight.

Joseph Guarino, Director of Compliance, Deutsche Bank, Private Wealth Management, fielded questions from an audience of CIOs, independent investment advisors and broker/dealers. He emphasized the changes in the strategic importance of the role of the compliance officer, and how they have been held personally responsible for a company's compliance performance. As a result of the Advisor Compliance Rule, compliance officers must consistently oversee activities like trading, record-keeping and client communications. After exploring the classic question of whether to build or buy IT systems for compliance monitoring, Guarino said buying -- particularly for smaller firms -- is often a very viable and less-costly option. "Look to buy before you build," he said. "Shop around, and reach out to colleagues in the industry before [you make a decision]."