After watching in TV how the World Trade Center was blown up, we have to face up with (at least) the following compliance matters:
- The fund houses were so fuzzy about suspension of dealings during the time of market disruption.
- Terrorist financing was added to the anti-money laundering guidelines.
- Business continuity plan has become a must for all financial institutions.
Terrorism is really uplifting the compliance cost globally. The most terrible element of terrorism is that the behaviors are not motivated by economic interests, and the terrorists do not care about the punishment (even life could be sacrificed). Terrorism is also a "highly leveraged business" -- you can just spend a few thousands to do a harm costing millions of dollars.
Various governments have put a huge amount of resources on combating physical terrorist attacks. I am pondering whether in future terrorists would evolve into non-physical attacks through manipulation of the financial markets (e.g. spreading rumors of crisis around). Then the regulators would have to differentiate international speculators from terrorists.
Last Friday (one business day before 911), SFC issued a circular to remind all licensed / registered firms to update any change of "emergency contact person". Is such gesture a bit sensitive?
The people responsible for issung that circualar did that intentionally. They demonstrated to their bosses that they were proactive and institute possible precautionary measures.
ReplyDeleteThey issued a circular entitled Be alert to individuals pretending SFC staff the other day.
I see this equivalent to a fake SFC website. And hence the SFC should publish a cirular to the public (e.g. message on website, statement in newspapers, announcement on T.V.) and not to LC only. They should adopt the same remedial actions they expect of LCs.