Five critical regulatory developments in 2023.

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Katherine Hill, Head of Financial Services Vertical Marketing, T-Mobile for Business

Oversight involves an increasingly complex and fragmented web of domestic and international regulators. Here are five impactful developments we’re following in the financial services sector.

Regulatory trends

Compliance challenges facing the financial services sector.

  1. Crypto regulation under consideration: The US government has added cryptocurrencies to laws designed to combat illicit activity, but it has yet to enact a new compliance regime. The Federal Reserve continues to build the case for more regulation, while the Securities and Exchange Commission has its own initiatives underway. As regulators continue to inch toward more stringent oversight of crypto, financial institutions should prepare for a steady stream of new regulations.

  2. Expanded OFAC sanctions: Over one year after the invasion of Ukraine by Russia, the U.S. Department of Treasury continues to toughen its economic sanctions, which include an OFAC price cap for crude oil and petroleum products of the Russian Federation. While sanctions are difficult to enforce, they will remain in place for the duration of the conflict and, depending on how and when the war ends, beyond that point.

  3. SEC regulations around cybersecurity infrastructure and breach reporting: In February 2022, the Securities and Exchange Commission proposed significant changes to its rules to improve the disclosures required of public companies related to cybersecurity risk, strategy, governance, and incident management. Now expected in April 2023, the final proposal will create a new set of challenges for companies already struggling with countering cyber threats. It will also increase demand for directors with cybersecurity knowledge and experience.

  4. Stricter enforcement of SEC record-keeping requirements: For financial institutions subject to the Securities and Exchange Commission books and records rules, messaging apps can create a compliance problem and result in significant fines and penalties. In September 2022, the SEC fined 10 well-known financial institutions and five of their affiliates over $1.1 billion for failing to comply with the agency’s rules governing the preservation of electronic communications. The SEC's enforcement shows that compliance with existing rules and regulations cannot be overlooked as technology evolves.

  5. Heightened focus on AML and cybersecurity: FINRA's 2023 Report on the agency's examination and risk monitoring program includes four new sections on anti-money laundering (AML) and cybersecurity and technological governance (additional sections cover fraud, sanctions, and manipulative trading.) This report highlights key regulatory obligations and related considerations for each form of financial crime, which provides firms subject to FINRA's oversight with critical insight into the agency's priorities.

Compliance strategy

Revisiting regulatory compliance with new technology.

While technology is a driving force behind increased regulation, it can also play an essential role in helping financial institutions achieve compliance. Part of that effort should include reexamining your compliance technology and strategy – and seeking guidance on how to prepare for new regulations or changes in how the government interprets, applies, and enforces existing regulations.

At T-Mobile for Business, we’re focused on providing your business with connectivity solutions and the dedicated, exceptional service you need to help you stay ahead. 

About the author:

Katherine Hill.
Katherine Hill has over 20 years of experience in the financial services sector, including work with banks, brokerages, and investment managers. Her consistent business focus is driving growth and reducing risk through better technology.

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