Financial services professionals including asset managers, broker-dealers, and other firms are implementing compliance as a core function of their business, according to a survey conducted by Cipperman Compliance Services (CCS).
The survey, in which 180 executives tasked with compliance in the financial services industry participated, found that although a greater number of firms have formed compliance committees and conducted reviews of their compliance programs in the past year.
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The study showed that 63% of asset managers already have a compliance committee at their firm, up 48% compared to 2014, while 88% of the respondents have conducted a compliance review in 2014.
Only 18% allocated more than the industry-benchmark 5% of revenues to such activities. According to the second annual C-Suite Survey, 29% of asset managers, 35% of broker-dealers, 14% of alternative managers, and 31% of wealth managers were unaware of how much they spend on compliance.
The report says that 81% of the respondents said they are "concerned" or "very concerned" by the Securities and Exchange Commission’s practice of naming and prosecuting individuals.
Moreover, 70% of respondents said that prospective clients have asked to review compliance policies or interview compliance personnel.
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By GlobalDataThe study revealed that 57% of respondents outsource some or all of their compliance function, a rise of 24% compared to 2014, while 65% of respondents embracing outsourcing are broker-dealers and 68% are alternative managers.
CCS managing director Jason Ewasko said: "These figures show, as they did last year, that it is much easier to talk the compliance talk then walk the walk. Firms should spend a minimum of 5% of revenues or two basis points of assets under management on compliance in order to have an effective program."
