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Selecting the Right Technology for Regulatory Compliance
As compliance requirements grow in scope and complexity, firms are turning to technology not just to meet minimum expectations, but to gain strategic control over their risk, reporting, and oversight functions.
Whether you’re evaluating Governance, Risk, and Compliance (GRC) software, exploring RegTech tools, or replacing outdated systems, selecting the right technology can be the difference between a reactive compliance posture and a proactive, exam-ready program.
This guide outlines how RIAs and broker-dealers can evaluate and select compliance technology that aligns with regulatory expectations and supports business goals.
Why Technology Selection Matters in Compliance
The right compliance technology enables firms to:
- Automate repeatable tasks (e.g., attestations, trade reviews, reporting)
- Centralize policies, procedures, and testing in one platform
- Detect issues proactively with real-time data and alerts
- Maintain accurate, auditable records
- Scale compliance oversight alongside business growth
On the flip side, the wrong system can result in inefficiencies, fragmented oversight, and regulatory risk.
Related: How to Assess Your Firm’s Tech Stack: A Compliance Guide
Key Questions to Guide Technology Selection
- Does it support your regulatory requirements?
Ensure the system supports FINRA, SEC, CAT, Reg BI, AML, and CAIS obligations relevant to your firm’s registration and activities. - Is it scalable as your firm grows?
Consider whether the solution will still meet your needs as your firm expands its client base, lines of business, or jurisdictions. - Does it integrate with your existing tech stack?
Seamless integration with clearing firms, custodians, CRM platforms, and other operational systems is critical to ensure data accuracy and real-time oversight. - Is the vendor stable, secure, and service-oriented?
Conduct vendor due diligence to assess financial health, security protocols, and service levels. - How easy is it to use and adopt?
Compliance tools should empower—not overwhelm—users. Look for intuitive interfaces and strong training and support programs.
FAQs
- What Is RegTech?
RegTech, or regulatory technology, refers to digital solutions that help financial firms meet compliance and regulatory obligations more efficiently. Tools may include automation of reporting, surveillance, onboarding, and documentation processes.
Oyster Solutions is one example of a RegTech platform built specifically for RIAs and broker-dealers.
- How Do Firms Choose Compliance Software?
Firms often begin with a technology assessment (see our tech stack audit guide) and identify compliance functions that can benefit most from automation. From there, they evaluate vendors based on regulatory support, integration, ease of use, scalability, and security. Many firms involve stakeholders from compliance, operations, and IT in the final decision.
The Risk of Waiting Too Long to Modernize
Outdated or disconnected systems may still work—for now—but they introduce:
- Operational risk due to manual processes
- Regulatory risk from inconsistent or incomplete records
- Scalability challenges that prevent growth
Regulators increasingly expect firms to demonstrate strong technology oversight and governance. Choosing the right platform now helps you stay ahead of scrutiny.
What to Look for in a GRC Platform
Governance, Risk, and Compliance platforms should unify your compliance ecosystem and enable:
- Real-time trade surveillance
- Risk-based AML monitoring
- Automated attestations and disclosures
- Role-based workflows for testing and reviews
- CAT/CAIS reconciliation and reporting
- Integration with core data sources
Oyster Solutions, for example, was built by experienced consultants who understand what it’s like to sit in the CCO’s seat—and what technology must do to truly support exam readiness and compliance execution.
