Branch Exams and Program Design

Branch exams are a critical part of every broker-dealer’s system of compliance and controls, and must address risk while ensuring your firm is complying with relevant rules and regulations.  Branch exams are more than just walking into a location and working from a standard checklist. Branch location types, business lines, products, firm changes and varying state regulations should all be addressed in your exam modules, and procedures for handling unacceptable risks or deficiencies should be in place.

Regulators focus their attention and resources on areas where they believe the risk is greatest. Firms should produce data to enhance understanding of its business and outlying practices, rather than having regulators point them out.

Firms should:

  • Produce data to conduct a thorough pre-audit process, including transactional data involving particular branches;
  • Interview the right people before going to a branch to ensure understanding of the unique challenges and risks including supervision teams, surveillance and business support;
  • Have a pre-defined process to address issues that arise during the exam;
  • Work with examiners to ensure they have the knowledge and skills necessary to effectively complete the exam;
  • Prepare branch supervisors and financial professionals for branch office exams; and
  • Produce data that helps create an understanding of enterprise wide risks and determine what additional resources may be required (training, technology, procedures, people) to enhance the firm’s compliance program.

The Oyster Difference:

Oyster Consulting knows that each compliance program should be unique, matching your business practices. Oyster provides both branch office on-site examinations outsourcing and program development assistance to improve your control environment.  Our experts have years of industry experience and can quickly prioritize the assessment with a thoughtful process. Oyster will review each Branch Exam program to ensure you are addressing risk while complying with relevant rules and regulations.

Oyster Consulting recently partnered with the NSCP and Raymond James & Associates, Inc. to produce an educational webinar: Creating and Executing Effective, Customized Branch Examinations.

Creating and Executing Effective, Customized Branch Examinations

Oyster Solutions software is a highly-customizable platform designed to make your firm’s risk assessment and branch office reviews and exams more efficient and effective. Oyster Solutions provides a risk inventory based on the products you offer, the structure of your organization, relevant regulations and the business processes you use. Part of this risk inventory includes a detailed, role-based branch office exam.  For more information about how Oyster Solutions can improve your compliance program, visit www.oystersolutions.com.

Author: Associate Director, Bill Reilly

Bill assists industry firms with developing Written Supervisory Procedures (WSPs) for broker-dealers and Policies and Procedures (P&Ps) for investment advisers, as well as providing in-house firm training for dealing with vulnerable adults and senior clients. Included in these WSPs and P&Ps are procedures for complying with state regulations for addressing client disbursement holds when financial exploitation of the client is suspected. Bill also acts in an outsource capacity to assist firms in meeting their branch office  examination cycles.To learn more about how Oyster can assist your firm with its regulatory compliance, complete our contact form and one of our Relationship Managers will be happy to help you.

 

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