Welcome back to the Compliance in Context Podcast! On this episode of the Compliance In Context Podcast, we explore the hidden nuances and key differences in the new 2022 Report on FINRA’s Examination and Risk Monitoring Program with Susan Schroeder—former head of enforcement at FINRA and current partner at Wilmer Hale—who sits down with us to review the report and its impact on compliance professionals everywhere. In our Headlines section, we look at the recently released annual priorities issued by the SEC Division of Examinations. And finally, we’ll wrap up today’s show with another installment of History Has Your Back series where we look at the legendary kung fu martial artist, Bruce Lee, and a quote to help inspire you and provide peace of mind for the securities compliance professional.
09:45: “On a really high level, my reaction to the report when I read it was that the report reflects the enormous amount of innovation and disruption that is rippling throughout the industry. Right? I think we’ve all heard a lot about new business models through fin-tech businesses for example, that are changing the way people invest. Changing the shape of investment relationships.” - Susan Schroeder
10:20: “One of the things you can also see emerging is the fact that FINRA’s rules are not written for the way business is done today and some of their observations and some of their priorities really reflect a disconnect between rules that might be seventy years old and practices that are very 2022.” - Susan Schroeder
12:16: ““I think now though, a lot of the challenge you’ll see across the industry is that the industry has room. Right? With the proliferation of new technologies, with people doing app-based trading on their phones, you’ll see events like the Gamestop event last year where the amount of trading that is done in a single day just eclipses previous records.” - Susan Schroeder
17:02: “I think, the fact that we talk about technology governance as if it’s a known thing is already a big indicator that your firm should be worried because that is a framework to exist. Right? No one was talking about that, even, for years ago. And this notion of technology governance is that the business is obligated to supervise the technology. Right? I think it’s a new concept and one that has not been well built-out by the regulators.” - Susan Schroeder
26:57: “The mobile app gives everybody access to…real time information. It is funny to me that there is as much concern that it is driving customer behavior when I consider it really to be a great equalizer, in providing information to people in a way a large group of investors could not have before.” - Susan Schroeder
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