Essential Strategies for Financial Services Compliance, 2nd Edition

Chapter 11Comply or Die – When Things go Wrong

When you read the words ‘Comply or Die’, many of us will think of the 2008 Grand National at Aintree. Many Compliance officers backed this horse because of the name. Others decided not to, because, as experts will tell you, you never back a horse simply because of the name. As you can imagine, the former group ended up buying the department's doughnuts that week, as the horse romped home as the winner. Of course, Comply or Die can have another, more important meaning to those of us who work in Compliance. Nothing ever happens in your firm (or my firm for that matter) that would cause the regulator to raise a disapproving eyebrow, naturally. However, knowing what is likely to make things go wrong, and what happens when they do, does serve a very useful purpose (other than the obvious voyeuristic pleasure that is to be derived from rubber-necking the bad girls and boys to see what they have been up to, and what will happen to them as a result!).

There are two main reasons for knowing about this:

• An awareness of the main roads to regulatory and legislative catastrophe – and, conversely, what is likely to feature (if at all) as a mere blip on the regulator's radar – is a useful tool in prioritizing work tasks and resources. Why spend time fretting about something insignificant that is happening on the equities desk when something much more hair-raising is afoot in Operations?
• The prospect of regulatory and/or legal censure can be a ...