How Outsourced Compliance Could Benefit Your Firm

Vigilant Insights

Brief Introduction

When it comes to compliance, many CEOs will ask themselves if outsourcing or co-sourcing their compliance is an efficient, safe, and financially sound decision.

As we have written in previous articles, there can be many unintended consequences of managing compliance, with limited resources. Today, we will highlight the potential problems your Firm may be facing with compliance, and the benefits of outsourcing or co-sourcing to a compliance firm, while discussing the main concerns decision makers may have.

The Benefits of Outsourced Compliance

• Ability to leverage the expertise of industry veteran Compliance Professionals.
• No longer managing Compliance in a vacuum. Your Compliance Consultants have insight into many firms.
• Gain a partner to support your operations, employees, growth, and goals, while also protecting your firm and your clients.
• Experienced and prepared team that has extensive experience in managing regulatory examinations.
• Maximizing internal Compliance resources, utilize Consultants to manage high volume, lower risk items to maximize your utilization of high costing internal Compliance Professionals.

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Potential Problems Your Firm May Have

• Firms must pull resources from growing the firm, serving clients, etc. to handle compliance work.
• A Zero-Sum game occurs when it comes to time and resources.
• Compliance tends to be procrastinated in lieu of work that grows the business, especially if it’s perceived as low risk or low priority.
• Important compliance decisions made with less experience and knowledge can stagnate the business or take unnecessary and costly risks (i.e. dual hatted CCOs with minimal CCO experience).
• Less effort is placed into creating a culture of compliance that is proactive instead of reactive.
• The small team of compliance staff must keep up with the ever-changing regulatory environment, relying on conferences and expensive training sessions from industry experts.
  • The material for Regulation BI alone is over 400 pages.
  • The SEC puts new Exam Priorities out every year.

Addressing Your Doubts

• Loss of Control?

  • Highly ranked compliance firms, like Vigilant, encourage you to maintain control of your operations and major decision making.

• Increased Risk to Your Firm?

  • Your risk is dispersed amongst a greater number of people, requiring a larger number of errors to fail vs. all the risk being placed on a single CCO.

• Is Your Firm Too Small?

  • Even small firms with diverse lines of business will require significant and complex compliance knowledge to handle their differing services.
  • Creating compliance procedures and monitoring at the foundation is significantly more cost effective than changing procedures that are already part of your processes.
  • Vigilant brings to you the experience of handling larger firms that have successfully navigated your same environment and thrived.

Vigilant’s Final Conclusion

The success of your firm depends on the strength of your compliance. As seen in recent SEC charges, the failure to comply with ongoing changes to the regulatory environment can be devastating. When making the right choice to outsource or co-source your Compliance, it is vital that you choose the proper firm.

Vigilant is committed to your business and its goals. We act as a partner in your business, with your success as our highest priority. Every firm has different compliance needs, and we work with our clients to find out what level of support they require. Our services range and vary based on your needs.

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