With global regulators taking an increased interest in control rooms and flow of confidential information, there is an expectation that integrated firms have robust information barriers and risk controls in place to ensure that material non-public information is only available to staff as and when required and does not leak to other parties.
Regulatory focus has also been on conflicts that can arise, as seen most recently in alleged FX manipulation between groups of colluding traders sharing confidential information on client trade orders, and it has long been a high-level principle that firms must manage conflicts of interest fairly, both between itself and its clients and between different groups of clients.
Assistance with control room and information barrier arrangements includes:
- Performance of a gap analysis between a firm’s current Control Room arrangements and regulatory expectations and best practice guidelines, as well as “what does good look like.” Provide value-adding and effective recommendations to close any identified gaps
- Design and implementation of an effective wall crossing process and the associated systems and controls including, roles and responsibilities, policies and procedures, training and guidance, lines of communication, maintenance of information barriers, etc
- Design and implementation of adequate compliance systems for the approval and monitoring of employee personal trading, taking into consideration the difference in PAD rules for different areas of a business and across multiple jurisdictions