Most Innovative Regulatory Solution: SIX Financial Information

IRD/IMD Awards 2017

IMD/IRM Awards 2017 Most Innovative Regulatory Solution
Max Bowie and Roger Bohrman, senior company officer, SIX Financial Information

After a decade of post-crisis implications, it is clear that most user firms are eager to listen when introduced to services designed to meet regulatory requirements. The relentless wave of regulation is overwhelming, and firms have turned to vendors for help—which is exactly what customers receive when turning to SIX Financial Information for support in identifying individuals, companies and beneficial owners to add to the do-not-trade list every day.

SIX Financial Information landed this year’s Most Innovative Regulatory Solution award with its Sanctioned Securities Monitoring Service. The service launched last summer to combat changes in the market as firms grew increasingly concerned about steep fines, and the potential for reputational damage and risk associated with the manual processes often used to manage sanctions.

 The panel judging the Inside Market Data and Inside Reference Data Awards highlighted that “the Office of Foreign Assets Control (OFAC) and other screenings of individuals associated with firms continues to be a tremendous challenge for the industry”, and the implications of making a mistake could include large fines or even loss of licenses to transact.

 To minimize this risk, firms need to automate the process associated with managing the data—which can also drive down the costs of managing sanctions. SIX Financial Information jumped at the opportunity to help address this issue by introducing the SIX Sanctioned Securities Monitoring Service. The service provides a daily list of issuers and securities that are linked to the domiciles, companies and individuals sanctioned by the UN, the European Union, the US, OFAC, HM Treasury (UK) and the Hong Kong Sanctions Regime. “We source the data, we run all the rule checks and we deliver a list of affected securities in a flat file that is very easy to use in whatever system the clients have,” says Phil Lynch, head markets, products and strategy at SIX Financial Information. Lynch explains that SIX started the list with Russian sanctions because that was the priority for clients, and the list has since been expanded to cover all global sanctions.

 With an array of regulatory requirements to meet, it is not surprising that a straightforward list that eliminates the need to source, scrub and map data while minimizing the risk of large fines and reputational damage has been well received. Lynch says the “take-up has been excellent”, and judges said the offering gives firms “no excuse for falling foul of regulatory penalties for doing business with sanctioned companies or individuals”.

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