With SEC and FINRA regulations constantly evolving and new, more sophisticated cyber threats emerging every day, cybersecurity and compliance are becoming increasingly top of mind for financial advisory firms.

On a recent Beacon Flash Podcast episode, Beacon Strategies’ Managing Partner Chip Kispert sat down with Aaron Spradlin, Chief Information Officer at United Planners, for a conversation about what it means to create a ‘culture of compliance,’ why it’s so important, and how United Planners has done so at their firm.

First, Spradlin defined culture of compliance as organizational buy-in to the importance of compliance and improving change management, as opposed to resisting new controls or looking at compliance as the ‘business killing division.’

Spradlin brought up the idea of ‘Cowboy Ethics’ as it applies to financial services and compliance, meaning that just because regulations don’t explicitly prohibit something, doesn’t mean you should do it. We shouldn’t be trying to skirt the edges, Spradlin explained. We should always be acting in the best interests of those we serve.

To that point, Spradlin believes it’s wealth management and investment advisory firms making the most significant advancements towards building cultures of compliance, while technology vendors are slower to understand and adopt their compliance obligations. Most vendors tend to believe they’ve found a silver bullet compliance technology or that a SOC II audit covers all their cybersecurity needs.

At United Planners, Spradlin and his team have turned cybersecurity into a recruitment tool by providing innovative solutions to advisors’ problems that also align with what’s best for the firm. For example, providing a private network removes data from the open internet, which is great for cybersecurity, but it also increases network performance and speed, which improves the advisor experience.

Over the next three years, Spradlin says, moving data infrastructures off the open internet will become the norm. Firms that don’t keep pace with cybersecurity and compliance trends by requiring authentication, offering IP restriction, managing known devices and segmenting data will no longer be in business. 

Overview

Cybersecurity 1:25
Culter of Compliance 3:16
Where The Industry is Headed 11:34
Vendor Due Diligence 15:36

Resources
Chip Kispert's LinkedIn
Aaron Spradlin's Linkedin
Beacon Strategies' Website
United Planners' Website