086. Regulatory compliance:
Refers to adhering to laws, regulations, and standards set by government agencies, regulatory bodies, and industry organizations.
Purpose:
1. Protect consumers and investors
2. Ensure fair market practices
3. Prevent financial crimes (e.g., money laundering)
4. Maintain financial stability
Regulatory Bodies:
1. Securities and Exchange Commission (SEC)
2. Financial Industry Regulatory Authority (FINRA)
3. Commodity Futures Trading Commission (CFTC)
4. National Futures Association (NFA)
5. Financial Action Task Force (FATF)
Regulations:
1. Anti-Money Laundering (AML)
2. Know-Your-Customer (KYC)
3. Payment Card Industry Data Security Standard (PCI-DSS)
4. General Data Protection Regulation (GDPR)
5. Financial Information Security Management Act (FISMA)
Compliance Requirements: Licensing and registration, Risk management and reporting, Auditing and accounting, Data security and privacy, Customer due diligence
Consequences of Non-Compliance: Fines and penalties, Reputation damage, Legal action, Business closure, Financial losses
Compliance Framework: Identify regulations and risks, Implement policies and procedures, Monitor and report compliance, Train employees, Review and update framework
Best Practices: Establish a compliance department, Conduct regular audits, Implement robust internal controls, Provide employee training, Engage with regulatory bodies
Industry-Specific Compliance: Banking and finance, Healthcare, Cryptocurrency and blockchain, E-commerce, Cybersecurity
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