Degrees of complianceThe recent spate of scandals involving rogue traders has thrown the spotlight onto the compliance officer. By Christopher Stoakes
By a brilliant stroke of timing, this month the first msc degree in financial services regulation is launched by London Guildhall University. Designed for regulatory and compliance professionals, it has already attracted a dozen students, all with several years' experience in compliance or financial services. Banks overhauling internal audit and risk management procedures to ensure they, too, are not brought to their knees by the antics of a single employee, might consider the £8,500 fee to be money particularly well spent. Although a compliance officer on his or her own could not have stopped or necessarily even have spotted what was going on in any of the recent debacles, there is no doubt that financial institutions in general are starting to take compliance very seriously indeed.
The dilemma every compliance officer dreads is whistleblowing. What happens if procedures and reporting lines are not being respected but the bank is apparently earning millions: if senior management disregard his warnings, should the compliance officer keep quiet or go to the regulators? If he keeps quiet he could run very real risks of censure, given his position, and find himself unemployable; if he blows the whistle he may lose his job and, again, find himself unemployable.