Productivity Remains for Broker/Dealers Working From Home - FINRA

Michael Volpe

After spending a decade in finance, Michael Volpe has been a freelance investigative journalist since 2009. His work has been published locally in the Chicago Reader, Chicago Crusader, Chicago Heights Patch, and New City. Nationally, Volpe's work has appeared in a wide variety of publications including the Washington Examiner, the Daily Caller, Crime Magazine, the Southern Christian Leadership Conference Newsletter, and Counter Punch. Volpe has been recognized by whistleblowers as leading the charge in getting their stories out. His first book Prosecutors Gone Wild was published in October 2012, his second book The Definitive Dossier of PTSD in Whistleblowers was published in February 2013 and his third book Bullied to Death was published in August 2015.

Productivity Remains for Broker/Dealers Working From Home

July 24, 2020

In the last episode of the FINRA podcast, FINRA Unscripted, the podcast recorded part of a recent FINRA virtual conference.

The conference panel consisted of FINRA CEO Robert Cook, Member Supervision Head Bari Havlik and Chief Legal Officer Bob Colby, and moderated by Chip Jones, FINRA’s head of Member Relations and Education.

FINRA is the Financial Industry Regulatory Authority; it is a self-regulatory organization which was formed in 2007 when the regulatory arms of the NYSE and NASD merged.

The topic quickly turned to the one on everyone’s mind, COVID 19.

Jones asked Cook how member firms were dealing with working remotely.

“I’ve been hearing from a lot of firms that that’s been working very well, that they’ve been maintaining a high degree of productivity and that while they may eventually return to the office, they don’t expect everybody to go back to the office the way they were. And that has implications for our work, our supervision of the firms and that’s a dialogue that we’d like to have with firms. Where do they see the future of the workplace going, so that we can adjust our rulebook our supervisory oversight.

“In terms of financial impacts on the industry, we have a very diverse industry that operates in a lot of different sectors of the financial services area, so frankly what I’ve been hearing is differences based on business models. There are some firms who practice and, or some business lines that are in areas that are much more challenged during this time. There are other firms or business lines especially those that involve trading activity that are seeing very high volumes and very strong business. So, depending on the business model in the firm, there very different kinds of experiences.

FINRA
FINRA

Cook further noted that the staff at FINRA was adjusting to working remotely as well.

“Sure. Well, as we alluded to before, we’re in a virtually entirely remote work environment now and we’re all getting our fill of video conferences as is everyone else, I know. And throughout this time, we’ve been maintaining a very high degree of productivity and continuity of operations. There are a couple of areas where our work, by its nature, has to be in person. And Bob alluded to some of that before. We’re doing exams, but we’re doing them primarily remotely now, or digitally would be a better way to say it. So, we’re continuing to get our work done while finding new ways to do it.

“In terms of when are we going back to the office, we have a task force that’s been helping to guide us through a series of phases that we would expect to follow to eventually return to the office based on a variety of triggers. Those might be things like local health and safety conditions, local stay at home or other governmental guidelines, the availability of public transportation, a whole range of different factors. And we would look at these factors at each of our offices.”

Havlik also noted that FINRA published in May a regulatory notice on the expect adjustments of working remotely.

“So, I’ll answer that by first stating that we did publish a notice, Regulatory Notice 20-16 in May, that notice didn’t share best practices, because we haven’t been able to go in and test. But it did their practices that, as our risk monitoring analysts have been working with firms, as they’ve adjusted to this fully remote environment, and so it’s a collection of practices that we’ve heard firms have implemented.” Havlik said on the podcast. “Again, we haven’t tested it. So, I can’t say they are best practices or can’t validate the effectiveness, but the Notice includes a number of areas, including a section and supervision, one on general supervision practices that firms have implemented, one on trading, another one on communications with customers and the public. So, I encourage firms, if they want to get a sense of what other firms are doing, to see if they can glean some ideas, that’s a good Notice to look at. Again, it’s Notice 20-16 and it was published at the end of May.”

FINRA Notice 20-16 can be found here.

It lists what should be done for customer assistance, cyber-security, compliance, and many other matters for member firms who are transitioning to working remotely.

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