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By now you’ve probably heard about the . In short, the SEC is getting even more serious about scrutinizing the compliance processes of investors — and by association their expert research vendors. Which means if you’re not reevaluating your expert research vendors right now, it’s probably time to do so. 

The good news is, Compliance has always been a top priority at ̨�����ϲʿ������. Why? Because we know how hard you work to get valuable, credible insights – and yet all too often they’re not usable because of compliance challenges, often presented by your vendors’ failing to provide the necessary air cover. Our Chief Compliance Officer   and challenged investors to put their expert research vendors to the test by asking 8 questions to help vet whether they see  “compliance” as a buzzword, or if they’re really doing what it takes to ensure your research is safe, useable, and in line with SEC guidelines. 

So… we thought we better show you how ̨�����ϲʿ������ answers those same questions. Our goal is to help you understand just how serious we take compliance.

1. How do you make sure your transcripts are free of confidential or material nonpublic information (MNPI)?

Every transcript must be reviewed for potential material non-public information or otherwise confidential information. That’s easier said than done, which is why ̨�����ϲʿ������ has a team of dedicated compliance specialists with decades of combined legal and regulatory experience. We created the category of investor-led expert call transcripts, and have years of direct experience in providing actionable, yet safe, expert insights to our customers. Our proprietary, structured review process involves our highly-trained team leveraging multiple, sophisticated surveillance tools to detect potential material nonpublic information and otherwise confidential information, among many other compliance scenarios we monitor. Taking a conservative approach, we flag for investigation any direct mention or allusion to revenues, earnings, mergers and acquisitions, partnerships, new products, management changes, supply chain and much, much more.

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2. When potential compliance issues are flagged, how do you investigate them?

Every instance of potential MNPI needs to be thoroughly investigated. ̨�����ϲʿ������ has designed a multi-layered, risk-based investigation and escalation process to ensure each flag is thoroughly vetted. Our goal is to eliminate any information that could put your firm at risk, while preserving the industry-leading, actionable experts insights for which ̨�����ϲʿ������ is known. Leveraging our own BamSEC product and other publicly accessible databases, our highly-trained team researches each flag in house to determine whether the information exists in the public domain. If so, we remove the flag and post the content for our users. If our team cannot identify the information in the public domain on its own, we partner directly with the expert who participated in the call to further vet the information and identify publicly available sources or other assurances that the content is safe. This entire process is documented, with every transcript on the ̨�����ϲʿ������ platform supported with robust expert due diligence information and flag resolution documentation.

3. Can I review and audit the investigation in real time?

You deserve complete transparency from your vendor. Periodically test your vendor by asking for the audit file for a random sampling of transcripts. If you aren’t satisfied with the answers a vendor gives you, chances are the SEC won’t be satisfied either.

At ̨�����ϲʿ������, we have dedicated compliance specialists available 24/7 to give our customers the information they need. They provide real-time documentation in support of internal firm requirements, restricted list maintenance, and even regulatory exam requests. We invite you to periodically test us (or any other vendor) by asking for the audit file for a random sampling of transcripts. If you aren’t satisfied with the answers a vendor gives you, chances are the SEC won’t be satisfied either.

4. How big is your compliance team, and what are their backgrounds and training?

Investment research compliance requires more than just fancy software, it requires experienced compliance specialists who can dedicate the time required to effectively identify, analyze, and resolve potential compliance issues. Do the math. How many transcripts is the vendor producing each month, and how many compliance personnel do they have to handle that volume? For reference, today ̨�����ϲʿ������ has a highly trained team of over 40 full-time experts, who bring decades of combined legal and regulatory experience and are dedicated to reviewing the 3,000+ expert calls each month. Our specialists flag 18% of transcripts on average and remove all problematic materials.

When vetting a vendor, we’d invite you to do the math. How many transcripts is the vendor producing each month, and how many compliance personnel do they have to handle that volume? Good compliance takes time and continuous training, and a team large enough to handle the volume of expert call transcripts. That’s why ̨�����ϲʿ������ has dialed in our compliance team’s workload to ensure effective review, every time. We monitor our team in real time to ensure consistency and constantly train on the latest regulatory changes and regulatory focus areas to ensure our customers stay protected.

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5. Do you post the actual recording of the expert call? If so, how do you handle flagging, investigating and removing any content that should not be published to the platform? 

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Every potential channel for the communication of material nonpublic information must be covered, including the audio of calls. Some vendors provide the actual audio of calls, while others, like ̨�����ϲʿ������, provide a text-to-speech version to help accelerate the research process while maintaining robust protection against material nonpublic information or personally identifiable information. Our customers, and our experts, demand no less. Using the actual recording of a call presents a host of issues, and even in the best case scenario likely reduces the value of the content.

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6. Will you integrate with my firm’s compliance program?

Regulators insist that you tailor your compliance program to your firm’s business — and that includes how you integrate with your investment research vendors.

With ̨�����ϲʿ������, you get complimentary access to a dedicated compliance portal that lets you control, monitor, and backtest your firm’s interaction with our products and services. You can escalate content for review by your compliance team before it’s made available to your investment professionals. We also have features that let you restrict certain content based on an expert’s work history, dial in cooling off periods that match your firm’s policies, or match your firm’s unique trading priorities or restricted lists.

Given the 2,500+ asset managers ̨�����ϲʿ������ works with, we would be shocked if you can stump us on a customization that we haven’t already built.

7. Can I speak to some of your customers that look like our firm, or any other third parties who can share their experience with your products and services?

Every vendor is going to tell you that they do what you need but the trick is getting them to prove it. We tell investors that we’ll  put them in touch with the biggest and most conservative investment firms we work with so they get credible references. We’ll also connect you with  third-party law firms or compliance consulting firms who have vetted out products and services.

At ̨�����ϲʿ������, we take pride in being the sole expert research vendors at some of the largest and most conservative investment firms in the world — firms who evaluated all expert transcript vendors but didn’t feel safe with anyone but ̨�����ϲʿ������.

Your firm spends too much time, money and effort on its research process and reputation, don’t risk it by using a vendor that takes short-cuts and puts its own interests ahead of yours.

To learn more about ̨�����ϲʿ������ Compliance click here.

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