spoke at the 2016 FINRA Annual Conference in Washington, DC, on May 23 focusing on the intersection of compliance and commerce. During his speech, he points out passionately that enforcement is just a part, not the whole, of an effective regulatory program. He said:
“While regulators strive to help the industry be perfect, we know that perfection isn’t realistic. And the regulatory structure is not a failure if some enforcement is required. Each day we should count it an equal triumph when an examination or our market surveillance program identifies issues and provides guidance that allows our firms to do the right thing by their clients without the need for an enforcement action.”
We agree wholeheartedly.
Guidance, doing the right thing, understanding the regulations and building solid compliance programs are triumphs not just for the regulated firms, but also for the industry and investors alike. Building strong cultures increases revenue and preserves hard won reputations.