Financial Markets Conduct and Compliance Services

Regulatory vigilance against the potential for improper trading continues to drive new enforcement and legal actions in the financial services industry – years after the momentous breakdowns at some of America’s largest investment banks in 2008. Damaged bank reputations, eroded client trust, and diminished financial performance have been compounded by the mounting cost of compliance with new regulations aimed at controlling the trading business. New settlements and enforcement actions are being announced almost weekly, with penalties, fines, and legal settlements already totaling over $25 billion.

Treliant’s Financial Markets Conduct and Compliance practice focuses on the challenges facing banks’ trading operations. How best to manage the conduct of employees and managers? And how can banks bring their business operations into compliance with both the letter of new regulations and the tacit regulatory expectations for appropriate behaviors? Made up of government veterans and bank business professionals, from the highest levels, our firm brings deep knowledge of both sides of the compliance challenge – to help clients understand a regulator’s view of their trading activity while addressing the realities of today’s largely automated trading activities.

Treliant is at the forefront of this work. We help detect and remediate misconduct at large international banks. We help those banks identify, prevent, and correct issues stemming from trading room misconduct.  

Our Markets Conduct and Compliance Global Advisory Services include:

Business Conduct Reviews

  • Review Sales Trading Conduct Policies, Procedures, and Implementation
  • Review Trading Pricing Practices and Management Oversight
  • Assess Effectiveness of First-, Second-, and Third-line Controls
  • Assist in Performing or Validating Market Conduct Risk Assessments Across Product Lines and Developing Action Plans that Meet Regulatory Expectations
  • Review Conflicts of Interest in Trading and Sales
  • Review Pre-Hedging and Front-Running Activity
  • Review Transparency to Client and Whether Sales Process is Fair, Clear, and not Misleading
  • Review Delivery of Best Execution

Surveillance Communications and Transaction Reviews

  • Employ Proprietary Tools to Review Chat and Email Communication at Scale
  • Employ Proprietary Tools to Review Trades and Transactions on a Wide or Tailored Scale, including Complex Structured Products

Remediation

  • Perform Independent Business Line Conduct Reviews
  • Perform Independent Business Controls Reviews
  • Perform Independent Compliance Reviews and Audits
  • Perform Independent Transaction Reviews (Lookbacks)
  • Develop and Implement Compliance Programs
  • Develop and Validate Tactical Remediation Project Plan, including Corrective Actions Identified in Regulatory Examinations and Enforcement Orders
  • Act as an Independent Monitor

Regulatory Exams

  • Perform Examination Readiness Reviews

Automated Trading and Pricing Algorithm Model Validation, Verification, and Certification

  • Perform Third-Party Review of eCommerce Pricing and Algorithm Codes
  • Provide Support and Enablement of Compliance Review Algorithms in Pricing
  • Provide "Harm Simulation" Capability to Evaluate Effectiveness of Trade Surveillance
  • Review Methodology and Rules Against Requirements for Best Execution and Far, Clear, and not Misleading Standards
  • Assess Adequacy of Model Documentation and Periodic Testing

Legal Action Preparation

  • Assist in Preparation for the Defense Against Legal Actions Citing the Institution and the Employee

Culture and Conduct Review

  • Assess Culture, Tone at the Top, Governance, Implementation and Measurement of Beliefs and Values
  • Employ the Conduct-iQ Model Using Social Network Analysis (SNA) to Analyze and Uncover Hidden Culture Carriers in an Organization—Positive and Negative
  • Employ Conduct-iQ SNA Machine Tools to Analyze Language Patterns from Internal and External Data, Using Algorithms Based on Cognitive Computing that Enable the Prediction of Risk Behavior and Conduct on a Wide Scale
  • Perform Assurance Review of Conduct and Culture Using Balanced Scorecard and Regulatory and Business Benchmarks from Management

Volcker Rule

  • Assess Standard and Enhanced Compliance for any Activity in Financial Instruments
  • Review Proprietary Trading—Exclusions, Exemptions, and Permitted Activities
  • Review Effectiveness of Risk Metrics
  • Review Key Defining Internal Models, including Customer Facing Trade Ratios (CFTR), Reasonably Expected Near-term Demand (RENTD), Trading Book Hierarchy, and Correlation Models for Hedging Products
  • Assist in Preparation for Regulatory Review, including TOTUS Decisions and Documentary Evidence Standards

Dodd-Frank Title VII Regulation of OTC Derivatives Markets

  • Assist in Preparation, Review, and Testing of Activity on and Controls over SEFs
  • Assist in Preparation and Review of Compliance with Clearing and Collateral Requirements
  • Assist in Preparation for Regulatory Reviews and Chief Executive and Chief Compliance Officer Attestation
  • Review First-line Business Controls and Second-line Risk Compliance
  • Review Compliance with Multi-Jurisdictional Transaction Reporting Requirements

MiFID II

  • Review Cross-Border Impacts of MiFID II Regulations on US Trading Operations
  • Review Preparation for and Compliance with Investor Protection Requirements
  • Review Preparation for and Compliance with Rules on Trading Venues, Algorithms, Pre- and Post-Trade Transparency, and Internal Matching and Crossing Trades
  • Review Adequacy and Effectiveness of First- and Second-line Controls Required by MiFID II

LIBOR Replacement

  • Assist in Preparation for the Replacement of LIBOR Benchmark by an Alternative Reference Rate—e.g. Repo General Collateral or Overnight Bank Funding Rate (OBFR)
  • Review System Changes, Project Management, Client Out-Reach, Legal and Documentation, Internal Hedging, and Risk Management Practices

CONTACTS

Susanna K. Tisa Susanna K. Tisa
Chief Business Officer
Waldo M. Abbot Waldo M. Abbot
Senior Advisory Board Member
Graham A. D. Broyd Graham A. D. Broyd
Senior Advisor
Mary Frances Monroe Mary Frances Monroe
Senior Advisor

Contact Us To Request


  • Financial Markets Conduct and Compliance Global Advisory Services Brochure
  • Financial Markets Conduct Oversight: Interest Rate Derivatives | IBORs | Government Securities
  • Financial Market Conduct Oversight: Foreign Exchange (FX)
  • Financial Market Conduct Oversight: Complex and Structured Products