As this challenging year comes to a close, we thank our clients and friends for your continued trust in ACA. We hope we've helped you navigate the year's ups and downs and provided clarity during times of uncertainty. To help you catch up and prepare for a successful 2021, we've curated a roundup of notable alerts and insights from ACA's experts, as well as well as key enhancements to ComplianceAlpha®. We wish you and yours good health and good fortune in 2021.
Despite the pandemic, this year has been business as usual for regulators globally, with COVID-19-related risks being among their highest priorities.
In the U.S., we saw an increase in enforcement actions and risk alerts from the Securities and Exchange Commission’s (SEC) Division of Enforcement. On the operational front, the SEC established the Coronavirus Steering Committee and announced that its Strategic Hub for Innovation and Financial Technology, or FinHub, will become a stand-alone office.
In the UK, the Financial Conduct Authority (FCA) spoke out regarding the need for firms to evolve their surveillance processes alongside the evolving risks of the pandemic.
On the technology side, the SEC and FCA signaled at the beginning of the year that technology innovation and data would be major focus areas for both agencies. This feels particularly prescient given the increased adoption of technology we've seen in the industry.
The following ACA resources provide more detail on these and other regulatory developments from 2020:
- Making a List and Checking it Twice: Year-End Recap and Checklist for Compliance Officers
- SEC Issues Risk Alert Identifying Six Areas of Deficiency in Investment Adviser Compliance Programs
- Revisiting Best Practices for Trade and Market Abuse Surveillance
- MAR Review: ESMA Publishes Report on Reforms to Market Abuse Regime
Firms are turning to technology at a record rate thanks in large part to the pandemic. According to industry analyst Greenwich Associates, 58% of firms invested in third-party surveillance technology in 2020, almost double from the same period in 2019. This is supported by the findings in Thomson Reuters' Fintech, RegTech and the Role of Compliance Report 2021: of the 400 compliance and risk practitioners surveyed, 70% said the pandemic has increased their reliance on technology.
But while firms are making progress with the digitization of their compliance programs, there is still work to be done: a recent OCIE Risk Alert noted technology gaps as an area of deficiency in investment adviser compliance programs.
ComplianceAlpha is here to help! Throughout the year, our experts in compliance, technology, and cybersecurity worked together to enhance ComplianceAlpha with innovative new features that will help our clients more easily manage their evolving business needs and regulatory demands. Here are some key new additions:
- Customizable dashboards and automated reporting – The platform’s new Analytics feature set connects your firm’s data to provide sophisticated reporting for measuring key performance indicators (KPIs), analyzing trends, surveilling compliance activity, monitoring employee conduct, and optimizing compliance workflows. You can create customized dashboards for visualizing and drilling down into the data, and schedule automated reports to systematize internal and external reporting obligations with flexible and visually appealing outputs.
- Integrated trade surveillance and market abuse detection functionality (Decryptex®) – ACA’s Decryptex functionality is now fully integrated into ComplianceAlpha to provide enhanced analysis and reporting on items of interest related to your firm’s and employees' trading activity.
- Ongoing AML KYC/CIP monitoring: ComplianceAlpha provides ongoing monitoring of over 90 sanctions and watchlists, politically exposed persons (PEPs), and more than 300 adverse media sources, as well as advanced name matching algorithms for both individuals and entities, all powered by ComplyAdvantage's industry-leading artificial intelligence-driven financial crime risk data and detection technology. Clients can receive optional full-service support from ACA's managed services team.
- Political contributions monitoring: This new feature provides clients with a single location for identifying, tracking, and reviewing political contributions by covered associates or employees and/or household members. Automated searches are performed against a centralized dataset of over 300 million political contributions from public FEC, state, and local databases. Additional support from ACA's managed services team is available.
- ComplianceAlpha Mobile App: The mobile app is designed to serve as our clients' on-the-go hub for compliance management, communication, resources, thought leadership, and future ComplianceAlpha functionality. It puts compliance at the fingertips of both compliance staff and employees so they can stay informed and on top of their compliance tasks while away from the office. Available on iOS or Android devices.
- Enhanced third-party integrations via open APIs: ComplianceAlpha can now integrate with third-party systems, such as HR systems, via open API to enable automated management of system users, restricted lists, screening lists, and more.
Resources and Downloads
ACA's experts in technology, compliance, and cybersecurity regularly develop resources designed to help our clients make sense of today's complex regulatory environment and strengthen their risk and compliance programs. Below are some of our key resources from 2020. For more, check out ACA's Spotlight Blog.
- U.S. Compliance Officer's Year-End Checklist
- European Compliance Officer's Year-End Checklist
- Trade Surveillance Program Gap Analysis Checklist
- 2021 Regulatory Filings Calendar
- White Paper: Trade and Transaction Reporting, Fast is Fine, but Accuracy is Everything
- White Paper: The Future of Risk and Compliance in the Age of RiskMutation™
Webcasts and Live Demos
Our informative webcasts and product demos are available on demand to watch/listen at your leisure:
- ComplianceAlpha 2.5 User Workshop/Demo
- Compliance Year in Review
- Regulatory Spotlight: The Heightened Focus on Insider Trading and Market Abuse Due to COVID-19
- The Tech-Enabled Compliance Officer: The Rise of RegTech and What it Means for Your Firm
For More Information
For more information or questions, please reach out to your ACA consultant or contact us here.