Financial Regulatory Forum

Wells Fargo case highlights need to monitor employees with stressful performance goals

September 22, 2016
One of the more difficult tasks for compliance officers is to question employee success, even if those achievements come against almost insurmountable odds. The disclosure that Wells Fargo employees, in order to meet sales targets, signed up more than 2 million of its customers for new accounts and credit cards without their knowledge, is an example of employee performance that should be questioned even though the impulse is often to look the other way.


Whistleblowing practices and severance agreements — what works

August 30, 2016

By Julie DiMauro, Regulatory Intelligence

(Thomson Reuters Regulatory Intelligence) – Through their enforcement actions, policy initiatives and press releases, United States regulators are showing what effective whistleblowing practices look like, and why their importance is growing.

Behavioral compliance: how to stop ‘good people’ from doing bad things

August 16, 2016

(Thomson Reuters Regulatory Intelligence) – Behavioral compliance is a relatively new way of thinking in combating bad behavior on Wall Street and beyond. Born out of frustration with repeated cases of misconduct and individual wrongdoing, both banks and regulators are looking outside their traditional toolkit in trying to curb unethical behavior. The effort is part of the ongoing cultural reform battle, and evidence of creative ways of leveraging other disciplines to tackle the problem is growing, say experts. (more…)

Is FINRA doing enough to steer investors clear of bad brokers?

August 9, 2016

By Todd Ehret, Regulatory Intelligence

(Thomson Reuters Regulatory Intelligence) – A recent debate has emerged as to whether U.S. regulators and the securities industry have done enough to rid themselves of bad brokers. At the core of the argument are recent studies showing that the percentage of those engaged in misconduct is much higher than that claimed by the Financial Industry Regulatory Authority, and that such brokers are often able to move unimpeded from firm to firm. (more…)

Ontario whistleblower policy seen strong on compliance culture, weaker on incentives, confidentiality

July 19, 2016

Ontario’s incoming securities whistleblower program will promote better compliance culture among market participants, but the limited incentives and confidentiality it offers to informants may hamper its effectiveness, legal experts have warned. (more…)

The clash of varying views of ‘culture’ among companies and financial regulators

June 14, 2016

By Todd Ehret, Regulatory Intelligence

(Thomson Reuters Regulatory Intelligence) – Culture, values, ethics, principles, and beliefs are all somewhat synonymous. Or are they? It depends on the setting and more importantly, the viewpoint from which one attempts to assess the philosophical concepts of right and wrong.

Outside business activities: Getting assessments and monitoring right

June 7, 2016

By Julie DiMauro, Regulatory Intelligence

(Thomson Reuters Regulatory Intelligence) – Broker-dealers and investment advisers must appreciate their obligations to report on their employees’ outside business activities and implement effective practices related to monitoring and supervising them.

U.S. banks, regulators see progress, but not yet victory, in culture battle

May 17, 2016

The struggle to instill stronger cultural values and ethics into U.S. banking organizations has shown signs of progress over the recent past, but maintaining momentum requires business leaders to remain committed to the process, according to senior bankers and regulators. Moreover, it remains to be seen whether the reforms banks have put in place prevent any future scandals from emerging. (more…)

Ontario’s no-contest settlement with CI Investments a lesson in self-policing

February 25, 2016

The Ontario Securities Commission (OSC) has approved a C$164 million no-contest settlement agreement (PDF) with CI Investments Inc. to compensate investors for the firm’s failure to accurately calculate the value of certain mutual funds. It is the largest investor compensation package to result from a no-contest settlement since the OSC began using them in March 2014, and reflects the intended “self-policing” outcome of the OSC’s Revised Credit for Cooperation Program. (more…)

COMMENTARY: ‘Get tough’ law enforcement needs ‘get tough’ governance, too

September 23, 2015

By Scott McCleskey, Regulatory Intelligence Expert

NEW YORK, Sept. 23, 2015 – The U.S. Justice Department’s initiative to focus on individual culpability in corporate crimes is long overdue and holds the potential, if vigorously pursued, to put teeth into efforts to enforce the law by deterring criminal activity. There are costs and perils to this approach, but the continuing litany of corporate misbehavior despite rising corporate fines suggests that other approaches have been less than effective. (more…)