What used to be a booklet is now getting to be the size of a telephone book.
That’s what’s happening to Susquehanna Financial Group’s ‘Written Supervisory Procedures,’ the set of policies and procedures that govern conduct in the trading room, according to Michael Doherty, head of compliance at the brokerage.
Because of a surfeit of new regulations, the firm’s WSP has expanded significantly, requiring Susquehanna to spend more time and money on compliance.
“Regulatory oversight has just ballooned as have the costs involved,” Doherty said at a Security Traders Association conference in January. “It’s gotten to the point where every morning we have to make sure the doors are locked in the trading room and somebody has to sign off that they inspected to make sure the doors were locked.”
The WSP is the starting point for every Financial Industry Regulatory Authority exam, Doherty explained. “Before an exam even begins, they ask for a copy of that document,” he said. “Then they highlight certain sections and ask us to prove that we are doing what it says we are in the document.”
Susquehanna’s compliance department generates 30 reports per day,” Doherty added.
To keep up with the expansion of the rulebook, Susquehanna utilizes technology. The Philadelphia-based firm now has 20 compliance technologists working in its compliance department. “They’ve been brought in from other areas in the organization, and are hard-pressed to keep up with the workload,” Doherty said.
