Red Flag Locator
Expedient Compliance Review Service
The most cost-effective way to spot your firm’s red flags – before the
regulators!
Keeping in compliance for many today is more than a full-time job. This new
economic environment coupled with heightened regulatory oversight makes it even
more difficult to withstand an SEC examination without risk exposure to the
firm. Your firm’s best defense—the Red Flag Locator, an expedient compliance
review service that takes the guesswork out of finding your firm’s red flags.
You provide NRS with information about your firm and sample documents. Then, NRS
will spend time reviewing the documents, noting any recommended changes and
discussing those changes with you.
The Red Flag Locator begins with an initial telephone consultation between
your firm and your assigned NRS consultant to orient NRS to your firm. NRS will
then request the following to review:
Regulatory Documents:
- Form ADV
- Form ADV Annual Offer
- Insider Trading Policies
- Personal Securities Trading Policies
- Privacy Policy
- Code of Ethics
- Best Execution Policy, if any
- Soft Dollar Policy, if any
- Aggregation and Allocation Policies, if any
- Most recent SEC or State Deficiency Letter and Response
Marketing Materials:
- Current Advertising material
- Current Marketing materials
- Performance information used in Marketing Materials
- Website review
- Most recent Client newsletter, if any
Operational Forms:
- Standard Order ticket
- Sample Client Monthly and/or Quarterly Statements
- Sample Client Invoice
- Solicitor Agreement and Disclosure Letter, if any
Other Material
- List of Clients by State
- List of State Notice Filings or State Registrations
- List of Investment Adviser Representative and States where registered
Once received, NRS will review the materials and provide recommended changes.
Your NRS consultant will also review the firm’s client list and IA
Representative registrations by state, as well as the firm’s notice filings or
state registrations to determine consistency and to note any new registrations
or filings that may be required.
With the review process complete, NRS will forward to your firm a final package, which will include
the ‘marked-up’ documents with suggestions as well as a brief summary of
your firm’s deficient areas.
At the end of your Red Flag Locator compliance review, NRS will provide you
with a confidential consultation offering recommendations to correct
deficiencies in your compliance procedures.
Use NRS’ Red Flag Locator to spot your potential problems so that you have
the time to correct them before the regulators locate the red flags.
Fines, disclosure, and suspension are just a few of the possible penalties
you and your firm can be faced with for not complying with the rules and
regulations.
For more information, contact NRS at (860) 435-0200.
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