The Socially Savvy Advisor + Website: Compliant Social Media for the Financial Industry

Chapter 7What Are the Top Challenges Compliance Officers Face?

“Oh no! New technology is on hand that is destined to change the way my financial advisory practice does business! I'm the chief compliance officer, and the buck stops with me—how am I going to get my arms around this in a way that ensures I don't run afoul of dreaded regulators?”

If you're a chief compliance officer (CCO) who's reading this book, you may have had that very conversation with yourself—perhaps 20 years ago. Yes, when e-mail first arrived on the scene, many advisors fretted that this new way of doing business would carry regulatory pitfalls that could lead to their undoing. It's natural to fear the unknown, and advisors are loath to serve as test cases for oversight agencies that are getting their arms around the implications of technology. Yet ask yourself this question: When was the last time an advisor stumbled seriously during a regulator's audit over an e-mail issue?

“Plus ça change, plus c'est la même chose,” as the French put it—the more things change, the more they remain the same. CCOs who are concerned that the emerging universe of social media could trip up their practices should consider that advisors have been down this road before, and the results weren't disastrous. Indeed, the basic rules that govern compliance—rules that exist to protect investors from harm—do not represent a sea change from the principles that have steered advisors for decades, as we shall see.

What CCOs Should Know ...