After five months of review, the SEC’s Office of Compliance Inspections and Examinations (OCIE) has released a Risk Alert regarding compliance and process protocols during the era of COVID-19. As the pandemic continues, investment management firms have been challenged to maintain the high-quality service and standards their clients and the SEC demand.
OCIE Identifies Six Areas of Concern
Firms should take time to review:
- protection of investors’ assets
- supervision of personnel
- practices relating to fees, expenses, and financial transactions
- investment fraud
- business continuity
- the protection of investor and other sensitive information
In this series, you’ll get a detailed breakdown of each of these six areas of concern.
Focus On Business Continuity
If the COVID 19 crisis has put any particular aspect of an asset manager firm’s business to the test, business continuity and disaster recovery plans win hands-down.
With unprecedented business location shutdowns, reduction of travel, and health and family life issues of staff taking their toll, firms are experiencing a real-world execution of these plans. With these implementations, overlooked concerns, unanticipated consequences, and weak responses are being discovered on a near-daily basis.
As a primary, shareable platform resource, OpsCheck keeps all staff in the loop on their roles during normal business disruptions. With reduced staffing, some team members need to take on expanded roles and having a definitive resource for understanding these responsibilities has become a paramount concern.
Responsibilities of IT
IT groups within firms have a particular responsibility as companies have shifted to remote working environments. Activated continuity plans are being tested for their ability to provide necessary technology services to remote workers, exposing the sufficiency of infrastructure needs and data security.
As the COVID 19 crisis continues—and gives forewarning of similar future events—investors are more keen than ever to know how firm’s will handle catastrophic situations. Firms will need to provide their clients with accurate, current, and demonstrable plans and policies to raise confidence and trust to both attract new clients and retain existing ones in troubled times.
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