Reconciliation: it’s an everyday process in buy- and sell-side shops, where overworked middle-office analysts pay close attention to details and hope technology works. Like all post-trade operations, it often draws the attention of C-level executives only when something goes wrong. Even worse, as evidenced in a recent case involving Merrill Lynch, mistakes can also elicit […]
Outsourcing the CIO Role: A Rigorous Exercise in Matchmaking
In an increasingly complex environment of regulatory mandates and investment options, endowments, foundations and pension plans are taking a tack widely accepted in the post-trade communications market: outsourcing the critical functions of a chief investment officer. “They [asset owners] can easily create an investment policy — what they will or won’t invest in — but when it comes […]
European Transaction Tax: The Taxing Job of Getting Ready
Let’s face it. Consumers aren’t eager to pay sales taxes, but neither are retailers eager to charge and collect them. Taxes not only raise prices and potentially reduce the number of sales made, but tax collection also creates operational and technological burdens to administer. Now imagine operations and IT specialists across the globe having to […]
Bitcoins: What Compliance and Operations Experts Should Know
Bitcoins may sound like just a passing fad to compliance and operations specialists at fund management shops, but they would be foolish to presume that bitcoins won’t be part of their operations, and possibly soon. As the virtual currency gains momentum, they will need to brace themselves for new world of regulatory oversight. In recent weeks bitcoin has received […]
Fund Managers: Get Ready to Monitor Phone Calls on Swap Deals
It isn’t often that regulators take into account the concerns of market participants on the difficulties in implementing new rules. When it happens it is a great relief — particularly for some fund managers who are already struggling to meet new trading and clearing requirements for swap contracts. But when it comes to the recent […]
Fund Managers Tell Off US FINRA on TBA Margin Rules
Fund managers are up in arms about new rules proposed by the US Financial Industry Regulatory Authority (FINRA) requiring the collateralization of many US-forward- settling agency mortgage-backed securities transactions, or those of similar asset classes, and their potential quick liquidation trades in a worse case scenario. While FINRA has direct oversight only over US broker-dealers, […]
Fund Managers: Outsourcing Trade Operations Not For Faint-Hearted
It’s become commonplace for fund managers to outsource middle and back-office operations. After all, who wants to staff and oversee the labor-intensive work that comes after trade execution, especially if it can be contracted out to specialists? It’s commonly understood that this type of outsourcing can reduce operating costs, address regulatory compliance requirements, and most important, […]
Scottrade Fine: $2.5 Million When “Oops” Isn’t Enough
US IT and compliance directors need to pay a lot closer attention to how they jointly test and evaluate critical data generated by back-office systems. That’s the bare bones lesson, according to ten IT and compliance managers speaking with FinOps Report, that financial firms should learn from Scottrade’s reporting fiasco which resulted in a fine […]
Where the Buck Stops: FINRA Fines BBH and Anti-Money Laundering Director
Absolute personal responsibility with little to no authority. That’s how anti-money laundering specialists at some of the world’s largest banks summarize the job description of Brown Brothers Harriman’s global director of anti-money laundering (AML) activities. Besides a hefty fine to be paid by BBH in a settlement, Harold (Hal) Crawford will pay US$25,000 to the US Financial […]
Hedge Fund Managers: Taming the Data Headache
It’s a given that hedge fund managers consume data — and lots of it — to ensure the most lucrative trading strategies and efficient post-trade processes. They need to know just how the global market is moving at every fraction of a second every business day and just which transactions must be cleared and settled […]