This article first appeared as Compliance in Focus on Markets Media. Compliance in Focus is a content series on regulatory topics for financial markets and the challenges compliance officers face in addressing surveillance and monitoring. Compliance in Focus is produced in collaboration with Eventus.
Regulation of financial markets is arguably more in flux now than at any time since the wake of the global financial crisis more than a decade ago.
The U.S. Securities and Exchange Commission has been extraordinarily active, and as of Jan. 4 had 52 rules in proposed or final rule-making stages, including four significant equity market structure rule makings proposed in December. SEC enforcement actions increased 9% to 760 in its 2022 fiscal year, while money ordered in SEC actions totaled a record $6.4 billion, up a whopping 67% from the fiscal year prior. The European Union has pending rules for digital assets markets, while in Asia, regulators continue to tighten rules to bring market regulation more in line with U.S. and European standards.
With that backdrop, Markets Media is pleased to introduce Compliance in Focus, a biweekly content collaboration with Eventus. The aim is to cut through the haze of rule makings and deliver the most critical and timely information that institutional trading and investment firms need, not only to comply with regulations most efficiently and cost effectively, but to do so in a technology-forward way that can provide a competitive advantage.
“Having access to compliance expertise is table stakes in this environment,” said Joe Schifano, Global Head of Regulatory Affairs at Eventus. “That’s why we’re partnering to launch this new series — to connect experts across the industry.”
Schifano oversaw compliance at a large proprietary trading firm from 2016-2020, after previously holding senior roles in supervision and regulatory affairs at an exchange group and on the sell side.
“As a former chief compliance officer, I know the tough job compliance teams face,” Schifano told Markets Media. “They have to handle large volumes of data and alerts. They must understand regulatory risk, track rules across jurisdictions, and then document their decisions for regulators. And they must adopt the right technology so their talented employees can focus on high-value tasks.”
Every other Wednesday in this space, we will publish content themed around regulation and compliance, as well as surveillance and monitoring methods and technology. We’ll share Compliance in Focus content on LinkedIn and Twitter.
Schifano noted that trade surveillance is complex and costly when done with unreliable data and outdated technology, especially with the expansion of algorithmic trading and more demanding regulators. Avoiding enforcements actions – and their financial and reputational costs – requires future-proofing your company by being able to scale compliance operations and anticipating what regulators want to see, rather than just reacting to regulators.
“Getting compliance right is essential,” Schifano said. “Financial institutions that invest in this core function can thrive over time.”
