Regulatory agencies are taking an increasingly aggressive approach to enforcement, and firms can’t afford any missteps.
The SEC, for example, filed 501 “stand-alone” enforcement actions in 2023 — an 8% increase over 2022. The agency also doled out penalties totaling $4.9 billion — the second highest amount in SEC history. They’re also on track on finalize a record 64 new rules by the end of chairman Gary Gensler’s first four years in office.
Preventing costly fines and reputational damage requires modern business compliance software that can support rigorous employee compliance monitoring and enforcement processes as regulatory scrutiny intensifies. Relying on outdated solutions that struggle to keep up with change makes it harder for compliance teams to do their jobs — and increases the risk of errors.
Keep reading to discover five ways a modern business compliance solution reduces risk by protecting your firm from costly mistakes.
1. Automated issue detection
Business compliance software solutions use automation to help teams find compliance issues before regulators do. Solutions like Intapp Employee Compliance consolidate information about employee financial interests and outside activities, then automatically and proactively alert risk teams about potential problems so nothing falls through the cracks.
Broker feeds that automatically transmit employee transaction and holding information to the system mean issues are caught right as they happen — not weeks later when employees share their monthly statements, and irreversible damage may have already occurred.
These features let compliance teams quickly identify and address violations instead of spending hours painstakingly searching for them.
2. Automated trade pre-clearance
Solutions like Intapp Employee Compliance accelerate trade request processing and save compliance teams time by automatically approving, blocking, or denying trades based on firm watch and restricted lists. Automation supports an accurate, reliable pre-clearance process that minimizes oversights and misinterpretation of trading activities.
3. Centralized document management
Business compliance software solutions improve policy adherence by providing one central hub for completing and tracking attestations, disclosures, and other firm documents. And with Intapp Employee Compliance, if responses deviate from what’s expected, they’re proactively tagged for review. The solution also sends automated notifications that remind employees to fill out required documentation, so compliance officers don’t have to.
4. Comprehensive audit trails and reporting
Systems like Intapp Employee Compliance simplify internal audits and make it easy to respond to regulator requests by providing detailed audit trails for all employee activities. Instead of spending weeks tracking down documentation in multiple locations, compliance teams can quickly generate reports using custom filters and criteria. Compliance officers can also quickly understand where employee compliance efforts stand firmwide with intuitive dashboards displaying aggregated data.
5. Vendor due diligence support
SEC Proposed Rule 206(4)-11, designed to protect investors from improperly vetted service providers, expands due diligence responsibilities for registered investment advisers (RIAs). It will make the due diligence process more complex for RIAs and their vendors. Some business compliance solutions can simplify adherence with this pending rule by allowing firms to manage due diligence checks and all required documentation entirely within their platforms.
Protect your firm with a modern business compliance software solution
Using outdated software to ensure employee compliance with firm and regulatory policies is risky — especially with dozens of new rules looming on the horizon. Just one misstep has the potential to wreak havoc on your firm’s finances and reputation.
Transitioning to a modern business compliance software solution like Intapp Employee Compliance will help you avoid this fate. It helps your firm effortlessly manage adherence to firm policies and regulations, no matter how many rules there may be.
Contact us to see firsthand why leading firms such as Argonaut Private Equity choose Intapp to manage, monitor, and enforce employee compliance.