Easy Compliance Solutions to Support Financial Advisors

In the complex world of financial advising, maintaining compliance is one of the most critical yet challenging responsibilities. 

With ever-changing regulations and increasing scrutiny, finding efficient ways to meet compliance demands is crucial. 

The good news is that advances in compliance technology are making a big difference. 

By leveraging smart, easy compliance technology for financial advisors, firms can navigate regulatory complexities while focusing on what truly matters: serving their clients.

Why Compliance Technology Matters?

Further, financial advisors are obligated to keep records, monitor their communications, and file on time. 

Doing all of that on paper is tedious, prone to error, and stressful for advisors trying to comply with such rules.

These manual checks and processes can be streamlined by using compliance technology to support the advisor and the support staff to avoid service errors, meet deadlines, and have an audit trail for regulatory review. 

This not only limits risk but it can also aid in compliance and increase clients’ confidence.

Core Features of Compliance Technology for Financial Advisors

To be effective, compliance technology has to have a number of features that specifically address the needs of financial advisors:

Automated Task Management and Calendars

More advanced systems track deadlines for regulatory filings, employee training deadlines, deadlines for updating material disclosures, and send reminders, as well as tracking when these tasks are completed.

Communications Surveillance and Archiving

Compliance solutions can monitor emails, social media, and other communications channels for content that may need to be reviewed or stored. 

The surveillance captures and archives those client-facing communications in a scalable and searchable format to help firms meet their recordkeeping obligations.

Trade Monitoring and Personal Trading Oversight

Trade Surveillance measures trading activity by the individual and the firm against compliance rules to reduce undisclosed/prohibited trading, reducing the time and effort needed to identify and fix those trades.

Document Retention and Secure Storage

The storage and protection of compliance-related data and communications in digital archiving systems ensures that they are retained for the required period under regulation and are readily accessible for audit and investigation purposes.

Real-Time Risk Identification and Compliance Reporting

More modern platforms use AI to scan for compliance issues in real-time, proactively identifying compliance violations in order to create reports showing compliance and preventing non-compliance before it occurs.

How to Implement Compliance Technology Successfully?

Integrating compliance technology into a financial advisory practice requires more than just purchasing software. 

It involves aligning technology with workflow and compliance objectives:

• Start with a Needs Assessment: Identify your current compliance pain points and regulatory requirements. Determine which manual tasks consume the most time or where errors most frequently occur.
  
• Choose User-Friendly Platforms: Advisors and staff are more likely to adopt intuitive technologies with accessible interfaces and clear dashboards.
  
• Train Teams Continuously: A successful rollout includes comprehensive training and ongoing education to keep everyone confident in using the tools and understanding regulatory changes.
  
• Scale Gradually: Implement technology in phases, starting with high-impact compliance areas, to mitigate disruption and allow iterative improvements.
  
• Engage Expert Support: Partner with providers offering compliance expertise and personalized support to maximize the technology’s benefits.

Benefits for Financial Advisors

Well-implemented compliance technology for financial advisors unlocks numerous advantages for financial advisory firms.

• Reduced Manual Work: Automation streamlines routine tasks, freeing up time to focus on client relationships.
• Lowered Compliance Risk: Continuous monitoring and automated alerts ensure firms stay ahead of potential issues.
• Transparent Audit Trails: Centralized digital records simplify regulatory examinations and reporting.
• Improved Client Confidence: Clients feel reassured knowing their advisor operates with rigorous compliance standards.
• Cost Efficiency: Prevention of costly fines and reduction in manual effort contribute to financial savings.
  

An Example of Intelligent Compliance Assistance

AI workflows for compliance have been deployed to address different aspects of regulatory workflows. 

Examples include Luthor.ai, an AI tool that automatically generates regulatory filings, scans marketing materials for compliance, and keeps an updated compliance calendar.

As part of offering their AI compliance software solution, Luthor.ai also offers fractional Chief Compliance Officer services to provide firms with experienced compliance professionals working together with the software to manage risk. 

This combined approach offers financial advisors a powerful and easy way to scale their compliance efforts.

Looking Ahead: The Future of Compliance Technology

We will see bespoke and predictive AI compliance tools that not only highlight potential risk based on how a firm has behaved, but also take into account changes in regulation. 

Rather than being audited once a year, compliance will be monitored live, allowing firms to identify and fix problems in real-time.

Finally, it is expected that compliance platforms will also need to offer multi-jurisdictional features as regulations become increasingly globalized. 

Financial advisors who take the initiative to integrate these trends into their practices will likely see competitive advantages.

Conclusion

Financial services companies need user-friendly compliance solutions to keep up with a rapidly changing environment. 

Being able to automate compliance processes, actively monitor in real-time, and better manage risk helps financial advisors not let compliance get in the way of providing the best service to clients.

The right compliance technology for financial advisors, correctly implemented, can turn compliance from a millstone into a business enabler, protecting your firm’s reputation and making it easier to operate.