How Digital Tools Can Help Your RIA Firm Stay Connected and Compliant

How your RIA firm can utilize digital tools to help build relationships and increase productivity.

The convenience of digital meetings and communications cannot be argued. But some of the most important aspects of relationships—trust, respect, compliance with regulations—depend on in-person interactions with your clients and employees. Many believe physical meetings are more effective than digital when building relationships.

How can advisors keep up in a virtual world while still building and maintaining relationships?

1.) Supervise Your Remote Staff

RIA firms are required to supervise personnel, and it’s not just about trading activities. Remote work has thrown a wrench into employee supervision in unpredictable ways. Regardless of whether your staff is in the same building as you or not, failing to supervise your advisors (especially those with disciplinary histories) can come back to haunt you.

Does your firm have the capability to remotely supervise staff members who may not physically be in the office? Is the firm utilizing a web-based compliance software solution to ensure that employees continue to complete required compliance tasks, submit advertising content for review, submit client communications to be archived, submit personal securities transactions, etc.? Firms without the proper systems in place will be vulnerable to potential compliance risks and deficiencies.

It is important to regularly review and, where appropriate, modify compliance policies and procedures to address firm changes.

2.) Cybersecurity for Your Remote Team

Protecting sensitive information and keeping bad actors at bay is difficult enough when limited to one physical location. The rise of the remote workforce drives the need for RIAs to employ cybersecurity solutions.

RIAs should regularly educate their employees on cybersecurity risks and train them on how to avoid threats such as phishing attacks.

In a 2015 Cybersecurity Examination Initiative, the SEC outlined several cybersecurity focus areas for RIAs:

  1. Governance and risk assessment
  2. Access rights and controls
  3. Data loss prevention
  4. Mobile security
  5. Vendor management
  6. Training
  7. Incident response

While no system can fully protect your firm from an information security incident, the MyRIACompliance cybersecurity solution has been designed to efficiently construct, implement, and document a robust cybersecurity compliance program. Adopting a solution not only helps your RIA firm meet its regulatory obligations but also trains and educates your staff to help reduce the firm’s cybersecurity risks.

Additionally, While cybersecurity insurance is not a requirement, it is recommended for your firm. When selecting cybersecurity insurance, follow the steps you would when choosing any other type of insurance and turn to the experts if you need help.

3.) Employee Trade Monitoring

Do you have a stack of employee brokerage statements waiting for review?

The process of monitoring employee trading can be difficult, and that complexity has only increased with remote employees, who may feel somewhat removed from the usual process and policies. But trade monitoring is a key element of the Code of Ethics Rule, and it is no less a requirement now than it was when your entire team was in one place. For firms with several supervised persons, we recommend streamlining processes with automated employee monitoring software.

Considering your relationships with clients (and your team of advisors) may be mostly virtual these days, it’s imperative to implement a process allowing you to supervise your team, keep them safe from cybersecurity threats and monitor trades effectively.