ABSTRACT
This chapter examines the developing United States (US) regulatory expectations of compliance officers. Both the US Securities Exchange Commission (SEC) and the Financial Industry Regulatory Authority have started to target compliance officers. The SEC has stated that there are two principles which need to be balanced when determining whether the regulator will hold a compliance officer personally responsible. Ceresney identified a number of ‘predictor’ questions which might indicate the likelihood of regulatory enforcement action. The wrong answers to these questions could predict a strong risk of a compliance lapse leading to regulatory action. There are a number of examples of regulatory action against individual compliance officers working in financial firms. In 2019, the Department of Justice issued updated guidance on how it will evaluate corporate compliance programmes. The lack of adequate compliance programmes in this area has been noted by the SEC in its enforcement actions.
