New Risks Created by Dodd-Frank Noted as Top Compliance Priorities for Financial Services Firms

SAI Global Compliance announced the findings of its 2013 Financial Services Industry Compliance Benchmark Study. As a result of the growing number of new and updated regulations emerging over the past year, firms cited regulatory compliance, mitigating new risks created by Dodd-Frank and demonstrating compliance effectiveness as their top priorities in 2013.

“As individual regulations continue to roll out from the implementation of the Dodd-Frank legislation, financial services firms are stepping-up their game in terms of compliance and risk management”

An overwhelming 93 percent of respondents noted compliance with federal regulations as a high priority in 2013. While the ability to demonstrate compliance effectiveness also remained one of the top three priorities this year, a new concern moved into the top three: the increased risks created by Dodd-Frank. Eighty-three percent of participants named Dodd-Frank risks as one of their highest compliance program priorities, a sign that the legislation’s impact on firms continues to grow.

In line with the increasing impact of the Dodd-Frank legislation, the commitment of resources needed to address compliance requirements is also expanding for many financial services firms. Nearly 60 percent of survey respondents indicated that their compliance program budgets are increasing in 2013, with more than 20 percent noting a significant increase. Only 10 percent indicated that their budgets would decrease this year.

Survey results also indicated that increasing focus and resource commitments are driving improved results for compliance programs. In the 2012 survey, only 55 percent of respondents indicated that the effectiveness of their compliance programs had been validated using internal or external audits. This statistic improved to 73 percent in the 2013 survey.

“As individual regulations continue to roll out from the implementation of the Dodd-Frank legislation, financial services firms are stepping-up their game in terms of compliance and risk management,” said Steve McGraw, GRC President, SAI Global Compliance. “Fortunately, these increased investments seem to be paying off in the form of measured and validated improvements. As the Dodd-Frank implementation continues, we anticipate that most firms will continue to take the steps necessary to mitigate the growing compliance risks.”

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