Compliance professionals know how important it is to stay on top of compliance reporting requirements, but do all of the teams in your company know their roles in the process? It's important to make sure that all of your business units are communicating with one another to help eliminate any reporting gaps. Non-compliance through a delay, failure to report an issue or making a mistake in reporting can have a big impact on the reputation and bottom line of your business.
Your company can take a lesson from UBS Financial Services Inc. and The Vanguard Group. In March of 2015, after being cited for compliance violations, the two firms were hit with fines totaling $500,000 and $350,000, respectively, according to InvestmentNews. The Financial Industry Regulatory Authority (FINRA) fined the companies after discovering that the firms had failed to disclose actions such as customer complaints or wage garnishments against almost 200 of their brokers. Rules require brokerage firms to report criminal charges, credit actions and tax levies to FINRA within 30 days of occurrence, according to the SEC Lawyers Blog.
How does this apply to your business and its effort to avoid non-compliance? In reporting the story, InvestmentNews noted that the UBS and Vanguard infractions stemmed from oversights by payroll departments, which failed to disclose the issues to their compliance departments. The article provides an example that could easily happen to any company: "The two firms' payroll departments, for example, failed to notify compliance or do further due diligence when a wage garnishment order from a creditor was received," For large companies with departments in different locations, the communication challenges may be even greater.
The information provided in this blog post is for informational purposes only and not for the purpose of providing accounting, legal, or tax advice. The information and services ADP provides should not be deemed a substitute for the advice of any such professional. Such information is by nature subject to revision and may not be the most current information available.
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