The challenges of implementing effective regulatory decision-making provenance

Brock Arnason
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Brock Arnason: Droit Operating Company, USA

Journal of Securities Operations & Custody, 2024, vol. 16, issue 2, 136-145

Abstract: Financial institutions face significant challenges in implementing and enforcing regulatory data, specifically in transaction reporting and point-oftrade decision making. The lack of understanding and adherence to correct reporting procedures often leads to compliance breaches and subsequent fines. In this paper, the author provides a comprehensive explanation of regulatory data and how implementation poses challenges such as managing numerous source systems, constructing accurate decision logic, ensuring auditability and handling regulatory changes effectively. The paper also examines the benefits of adopting a best-practice framework, covering examples of transaction reporting and point-of-trade decision making. Finally, the paper underscores the imperative for financial institutions to embrace a best-practice framework for regulatory decision-making provenance which involves automating compliance, reflecting industry consensus and implementing control processes to address regulatory changes. By doing so, companies can ensure compliance, mitigate risks and adapt to the evolving regulatory landscape.

Keywords: AML compliance breaches; transaction reporting; point-oftrade decision making; regulatory decision-making provenance; bestpractice framework for regulatory data management (search for similar items in EconPapers)
JEL-codes: E5 G2 K22 (search for similar items in EconPapers)
Date: 2024
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