Passing the Burden of Compliance

By Jim Hooks, Managing Director, CCO

Feeling overwhelmed by the rules of compliance?  You’re not alone.  Regulations change fast and frequently these days, making it difficult for even the most seasoned advisors to keep up without a little help. 

Remember: you may be independent, but you are not an island. 

If you don’t think you’re the right person to handle compliance at your practice, here are some options to consider:


Develop Your Team

Some independent firms already have people on staff who can assist with compliance. As your practice grows, though, you will need to ensure they possess the knowledge and licensing required to handle new complexities. You will likely need to provide access to ongoing training activities to protect your firm from risk.

Hire Externally

On the other hand, you may need to hire externally to get the compliance expertise you’re looking for – but the average salary for a Chief Compliance Officer isn’t cheap, and there will be additional costs associated with running an internal compliance program. You need to consider whether this level of investment makes financial sense for your business.

Partner with an Expert

These days, more independent advisors are outsourcing the burden of compliance to supervisory firms in order to free their time for other important tasks – like serving their clients. If this sounds like an attractive option, you should carefully vet potential partners to ensure their compliance team is highly qualified, understanding of your goals, and communicative with you. 

You should also investigate what – if any – restrictions the supervisory firm will place on you. Some OSJ partners, for instance, have a set business model and will mandate how you must conduct your business. Others, such as Private Advisor Group, are more flexible. We allow you to build your business the way you want – while providing the guidance to ensure you can do it in a compliant manner.

At the end of the day, complying with regulations in an increasingly complex industry is never an option for investment advisors. But you do get to decide how you want to handle compliance. If you want a partner who lets you control your business while helping you keep on top of evolving mandates, send us a note.  We are happy to share our insights.

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