Document Type

Article

Publication Date

2013

Keywords

chief compliance officer, CCO, regulation, compliance, internal compliance, financial services, reputation, Dodd Frank, Sarbanes-Oxley

Abstract

This Article, written for a symposium on compliance issues in financial-services firms, focuses on the role of the chief compliance officer (“CCO”). Contrasting the position with that held by a firm’s general counsel or Chief Legal Officer (CLO), the article argues that a CCO’s position holds distinct challenges. Additionally, although internal compliance systems and personnel may be characterized as functional substitutes for external regulation, assessing the strengths and weaknesses of internal compliance requires a willingness to look deep within firms. The article argues that the law and regulation may enhance firms’ incentives to invest in effective internal compliance but may also undercut internal compliance through unforeseen consequences of legal doctrine and regulation; the relatively underdeveloped status of compliance as a profession may also serve to weaken the effectiveness of compliance personnel. The article recounts several recent incidents stemming from evident failures in internal compliance to illustrate more systemic and general issues.

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Library of Congress Subject Headings

Administrative law, Dodd-Frank Wall Street Reform and Consumer Protection Act, Compliance auditing, Reputation, Financial services industry, Sarbanes-Oxley Act of 2002, Ethics and compliance officers, United States

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