I’M SURE I HAVE SOME COMPLIANCE GAPS, BUT DON’T KNOW WHERE TO START...

​It can be very challenging for financial firms to search, monitor, and document​ ​their ​advisor's web presence and registered websites without interrupting day-to-day business demands and operations. Yet failure to do so can leave ​exposed compliance gaps unaddressed and open your firm up to fines and disciplinary actions from regulatory agencies. Common compliance gaps often include improperly documented or improperly enforced policies and procedures, insufficient evidence of a WSP, undisclosed OBAs and social media accounts, as well as rogue advisor websites. Many firms know that they have gaps, but they don’t know where to start.

FINRA publishes a monthly disciplinary report with actions and fines against firms and individuals. One of the most common fines involves undisclosed OBAs. Currently, many firms work on the “honor system” with hopes that their employees with be completely honest and disclose everything required. Unfortunately, this honor system doesn’t always work. How are you to find out if your advisors have an undisclosed OBA? That is where Eagle Eye can help you close this gap with our deep web searching technology that quickly cut through the clutter of the web and bring to your attention relevant results when monitoring your registered reps.

Do you know if your advisors have disclosed all of their social media accounts? In a recent random sampling of 10 employees from a prospective client, our Eagle Eye solution found serious violations with three of the advisors including several OBAs and social media accounts that were never disclosed. This is a typical compliance gap for many firms. Is this one your firm is facing as well?

Are you sure that your firm is monitoring all of your advisors online advertising? Do you have a process in place that is easy to demonstrate to a regulator? Do you even know if they are producing advertising that you are unaware of? This could be another compliance gap your firm is facing.

In addition to all of the supervision regulations, you need to prove that your firm has WSPs in place to help document all of the actions your firm is taking to monitor web presence. For many firms, this turns into another compliance gap they need to address.

You have a broker-dealer responsibility to monitor every website that your advisors' utilize for business purposes. Many times, advisors want to have their own website to help them stand out among the thousands of other financial advisor websites out there. How are you monitoring these websites? Are you notified of every change automatically so that it can be approved? If not, here is another compliance gap you might be facing, there has been an increase in fines imposed by FINRA regarding website monitoring. SiteQuest Compliance's SQWatcher program is an easy to use solution that will quickly help you fill this gap at a fraction of the cost of a fine.

Then to complete all of this monitoring you need to document all of your findings in an organized manner. Many times this is the last step in the compliance process and yet it can become one of the largest compliance gaps for a firm. Our automated documentation features found as part of our programs are detailed and searchable. We provide you with all of the information you need to respond to a regulator.

SiteQuest Compliance offers programs, support, and experience to help you bridge these gaps and respond to a regulator. A firm that is able to demonstrate compliance with tangible evidence will mitigate risks, such as costly regulatory fines, and be better prepared for unannounced visits from regulatory agencies.

Contact us today and talk to us about any gaps you need help addressing.

Recently I was told by a longtime client that our customer service is “old fashioned, but in a good way”. Perhaps that is the last thing a technology company wants to hear.
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As president of SiteQuest Compliance, I reflected over what our client meant in that statement. We do pride ourselves on the fact that when you call our office with questions or in need of technical support, that your call is quickly answered by a live person. We don’t force our clients to use service tags, make them navigate unhelpful phone trees, or waste time waiting in queues listening to mundane hold music. We are there for our customers, with a readiness and willingness to meet and exceed their expectations. 

Eagle Eye has proven to be incredibly effective at reducing risk as it continues to find websites, social media accounts and blog posts on the web that pose compliant risks to a firm, but did you know that it also saves time?
 
Yes, a lot of time.
 
One of our Eagle Eye clients recently reported that they were able to reduce their web supervision time by 80% since switching to Eagle Eye. That’s a huge number. How’s the firm utilizing their newly found time?
 
First, they are expanding their web surveillance program by increasing the depth of Eagle Eye’s search results (at no additional cost by the way). By increasing the depth by 60%, they’ll be able to uncover additional risks while demonstrating to their examiners and regulators that they are meeting their requirements for reasonable supervision outlined in NASD 3010, IM 30103, 3012, FINRA 2210 and FINRA 3270.
 
What else are they doing with their extra time?  Well of course they now have time for those extra compliance projects that have been slipping through the cracks over the past few years.
 
With Eagle Eye, not only do you reduce risk and meet your compliance and supervision responsibilities, you save lots and lots of time.
 
​ Isn’t extra time a wonderful thing?

Continually Making Sure Your Monitoring Records and Documentation are in Order
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This is not a preparedness matter to take lightly. Just last November FINRA fined a Tier One Company $2.6 million for failures in required electronic records and email retention. Read the full report.

The benefits of maintaining accurate, reliable and usable records can help to increase the efficiency and effectiveness of your business. It will ensure your firm is able to access information when required and meet all accountability and compliance requirements. Below are some suggestions that are beneficial in establishing and making sure that an effective record keeping and documentation system is in order when you are monitoring your associates' web presence.

Planning. Establish what processes are needed for monitoring records to be effectively maintained and how this will be achieved. Planning a monitoring process will help you maintain a record keeping system that works for your firm and provides clear expectations for supervisors and compliance officers.

Consistency. To make it easier for compliance staff members to do their job, have information collected and stored in a consistent way within your firm's network; all staff should follow the same policies and procedures.

Communication. Have all your staff made aware of, and ensure they understand, the FINRA general supervision requirements. Verify that all supervisors know and follow the record keeping policies and procedures established by your firm. By communicating expectations clearly, you will benefit from consistent record keeping standards.

Modify. Don’t be afraid to modify your record keeping system if you find a more efficient way to achieve results. Regular reviews of your record keeping systems will keep them up-to-date and operating in a way that is beneficial to your firm.

Responsibility. Know your responsibilities—what to record, how to maintain records and how long they should be kept. Having accurate and reliable records during an audit will allow you to easily confirm your firm’s compliance.

Review. Encourage staff to provide feedback on how the monitoring record keeping system is working and how it could be improved. In doing this, you may gain valuable suggestions that will bring continuous improvement to your administrative records, improving the efficiencies of the practice.

Embrace technology. Regularly investing in technology will help improve the efficiency of your general supervision monitoring requirements. Your staff will appreciate any efforts made to improve and automate the task of keeping records, giving them additional job satisfaction.  Additionally, removing manual steps not only makes the record keeping process more efficient, it also makes the records uniform and reduces the risk of human error.

Our clients have found that Eagle Eye’s automated reporting features saves them valuable time. With just a click, you will have everything you need including when a result was found, who reviewed it, comments that were made and time stamps on every action taken on the account. From a regulatory point of view, with Eagle Eye’s automated screenshots you will have the full story of what content looked like at the time of review, giving you everything you need to respond to a regulator.
 
Supervising the web doesn’t have to be difficult! Let us show you how Eagle Eye is a more effective solution. Contact us today for a demo. ​

The “Communications with the Public” Rule FINRA 2210 states that “an appropriately qualified registered principal of the member must pre-approve each retail communication before the earlier of its use or filing with FINRA's Advertising Regulation Department ("Department").”

“Retail Communications” include all electronic formats as well.

In addition to supervision approval:

“Each member shall establish written procedures that are appropriate to its business, size, structure, and customers for the review by an appropriately qualified registered principal of institutional communications used by the member and its associated persons. Such procedures must be reasonably designed to ensure that institutional communications comply with applicable standards.”

Our Eagle Eye and SQWatcher applications support your compliance program when it comes to complying with this rule.
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Our innovative Eagle Eye application will search the internet and allow supervisors to identify and discover your registered advisors’ online presence. Our multi-query processes and dynamically designed algorithms provide more accurate search results for supervisors to quickly review.

With our automated documentation and reporting features, you will have everything you need including when a result was found, who reviewed it, comments that were made and timestamps on every action taken during the online supervision of your registered advisors.

SQWatcher will supervise and archive all websites, even those not hosted with your approved providers. It will organize web-page changes into a manageable, easy to use workflow. Automatic triggers based upon your requirements will notify you of pending reviews.

These products were developed for the compliance supervisors who are looking for automated solutions to replace manual processes that prove to be ineffective and tedious.
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Note: NASD Rule 2210 has been superseded by FINRA Rule 2210.
 
Source: https://www.finra.org/rules-guidance/rulebooks/finra-rules/2210

What controls does your firm have in place to aid you in discovering DBAs if your advisors are not disclosing them?​

“DBAs and Communications With the Public” were one of the findings highlighted. FINRA continues to find that many registered representatives are not compliant with FINRA Rule 3270 in trying to conceal their outside business activities. ​

​One of our clients has been using the application for almost a year and described Eagle Eye as a “godsend.” 
 
Why? Since switching to Eagle Eye, this firm has:

• Reduced their web supervision workload by 92%.
• Uncovered potential compliance risks that were previously missed by their manual processes.
• Found additional time to take on other compliance projects that sometimes slipped through the cracks.

 
With Eagle Eye’s automated searches, easy-to-use workflow and blacklisting technology, this client was able to do their reviews in a fraction of the time it took when doing it by hand.  Not only has this time savings come in handy when it came to other projects, but they were also able to expand their supervision levels and are now looking deeper into the web through our application.
 
It’s certainly turned into a “Win-Win-Win” situation that only required a small investment in a tool that now automates a process that used to be completely manual.
 
Contact us today for a quick demo to see how Eagle Eye can not only save you time but also reduce your compliance risks.