Practical compliance for emerging managers - an interview with Ashleigh Swayze

By Carol R. Kaufman

According to Ashleigh Swayze, attorney, compliance consultant and outsourced CCO at Swayze & Co, "Compliance is not the wet blanket. It's the warm blanket that lets you know that your firm, in general, is put together in a smart and efficient manner. Creating, implementing and overseeing the compliance procedures forces you to think through your processes. It's the comfort of doing things the right way."

What a different...and refreshing... approach to this topic!. A CPO or CTA registered with the NFA does not have to designate someone as a chief compliance officer (CCO). However, even though exempt CPOs and CTAs are not required to have a formal CCO on staff, they are required to ensure compliance with the NFA rules governing their business conduct– definitely a time-consuming and knowledge-based task.

Per Chapman & Cutler's Chapman Client Alert in January of this year, "Registered CPOs and CTAs must complete and retain the NFA's "self-examination questionnaire" annually....CPOs and CTAs should review compliance policies and procedures, confirm whether amendments to those procedures are necessary and determine whether additional procedures may be warranted in light of the occurrences of the previous year... At least annually, CPOs and CTAs must also test disaster recovery plans and adjust as necessary, deliver privacy policies to every current participant, provide ethics training as described in the CPO/CTA's written ethics training procedures and update disclosure documents... "

In order to do the above, you need someone who understands the rules, understands your business, is close to the operations, has time to set up and effectively evaluate the compliance component and has the buy-in from the principals to be able to effect change, as needed.

Hence, the question: Who is going to be responsible for ensuring t......................

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This article was published in Opalesque's New Managers a top-down monthly analysis, news and research publication on the global emerging manager space.