Fancy a job in compliance at an FX brokerage? Demand and salaries are at an all time high. Here’s a full report

A few years ago, sales professionals and digital marketing experts were in such high demand that they were able to pick and choose which brokerage to work for, and could pretty much be offered a blank check when it came to remuneration.

Today, it is compliance executives that are in high demand and are able to charge day rates of between $1,000 and $1,600 as demand not only outstrips supply, but the highly technologically advanced nature of the electronic brokerage business means that skills are continually having to be honed and regulatory directives are becoming ever more complex.

Compliance is the new altus in demanda, therefore those wishing to pursue a career in this direction at a brokerage, or elevate their career to the next level, can look toward a future of being respected and sought after.

What do companies look for?

Today’s compliance and regulatory ecosystem is complex and multi-faceted. It spans from responsible officers within retail brokerages, to compliance executives within prime brokerages and liquidity providers, as well as those within law firms that provide specialist services to FX companies with regard to their establishment and ongoing operations.

Additionally, technology now plays a large part, with regulatory technology and electronic reporting companies having come to fruition.

In order to gain a full perspective, FinanceFeeds investigated in detail what each sector looks for and what key skills stand out specific personnel in compliance and regulatory positions.

With regard to taking a look at what needs to be considered, Ron Finberg, BD at EMIR reporting technology and automation company Cappitech explained to FinanceFeeds today “Firms need to analyze what their need is – when you talk about compliance people, there is both a legal aspect and operations. The legal aspect implies using the use of legal/compliance consultants or lawyers that are knowledgeable with rules and how your firm fits within existing/upcoming lawas and what needs to be done.”

He further explained “Operationally, you will have compliance positions to create required reports for regulators and monitor compliance systems. Compliance officers should also be knowledgeable of the relevant laws and read up on ongoing changes.”

“The difference between them and the legal team is that legal creates the compliance format to be implemented while the compliance team implements it and handles ongoing review. Ideally, the compliance team keeps up to date with rules so they can also be directing the future compliance process of the firm and work in hand with legal” continued Mr. Finberg.

With regard to reporting, Mr. Finberg stated “It is important to point out that many of the laws currently being implemented such as EMIR derivative reporting,  Dodd-Frank or MiFID II, much of it is a learning process. Therefore, specifics of many laws are a fluid process of the participant firms, technology and laws coming together.”

“As an example, in EMIR reporting which we handle, it is double sided reporting. That means both sides of a derivative trade need to report the trade to a trade repository but with the same unique identifier for each trade, so there is a hierarchy put in place of who creates the trade number that is used by both sides such as LP vs customer” – Ron Finberg, Cappitech.

In conclusion, Mr. Finberg stated “However, what happens if counterparties are on the same level of the hierarchy list, or there are delays of an LP or CCP to issue these unique trade identifiers to their clients? For ambiguous cases like this, you need compliance and legal people that can both interpret the existing rules, but also come up with new solutions that would technically fit with them EMIR framework.”

A specialist lawyer for the FX industry in Limassol Cyprus explained to FinanceFeeds today “Compliance Officers do not necessarily need to be legal professionals. In fact, based on my experience, persons with other backgrounds which include economics, management, finance, mathematics, and risk management tend to perform better in a compliance position as they can bridge better rules with practice.”

The lawyer further explained “Also, compliance means to ensure that the practices that are applied by a financial institution comply with the rules set by regulators. Most of the time, the rules issued by regulators are technical issues and not necessarily legal issues. In fact, even the local regulator in CY does not hire lawyers to supervise regulated entities.”

“Notwithstanding the above, Compliance needs to work closely with legal teams for matters that require specialized legal interpretation or legal input (e.g. agreements with clients)” he said.

“It all comes down to the qualities and skillset of the person employed. Since the Compliance role has become a popular position only the last decade you cannot find a specific academic background that fit exactly the compliance officer role. So you can hire people from diverse academic backgrounds and train them as long as they are smart and willing to learn” 

Trevor Clein, owner of TL Clein & Co is a regulatory consultant with three decades of years experience in Anti-Money Laundering, client on-boarding, Know Your Customer (KYC) and risk. Today he explained to FinanceFeeds “In 31 years, I have seen tremendous change in this once bureaucratic side of the business. Today, compliance officers need to understand the entire combination of components in electronic brokerage, right the way from client onboarding – done totally electronically these days, via a ‘faceless’ system whereas back in the 1980s single customers had relationships with a specific representative” said Mr. Clein.

“Reporting via complex systems often on a daily basis as a result of regulatory procedures such as EMIR in Europe and to regulators in the US has become a highly technical business, requiring full IT support for compliance departments and for compliance managers to understand the fintech world, internally and externally” – Trevor Clein, owner, TL Clein & Co

“The old paper forms are long gone, and the ecosystem has grown to encompass liquidity firms, payment solutions providers, platforms, brokerages and signal providers, all of which go together to make up the retail structure but are complicated in their own right. To be able to find compliance officers who are completely au fait with all of this and are able to save companies from falling foul of the laws and protect customers is not easy, and such people are valuable assets to companies, hence the high pay” concluded Mr. Clein.

David Andrews, General Counsel and Head of Compliance at of British electronic trading company Atom8 explained to FinanceFeeds today “Employing compliance staff in regulated business could not be more important as it is critical to both treating all counterparties and clients fairly as well as preserving the firm’s licence.”

“The best compliance officers must have a deep understanding of the sector and the underlying risks and be able to interpret and apply the regulations, applicable law and relevant guidance appropriately in terms of internal communications and systems and controls’ calibration” – David Andrews, General Counsel and Head of Compliance, Atom8.

Mr. Andrews, who is also an English solicitor concluded “There are times where strict compliance is absolutely required, and others where sound business judgement and a risk-based assessment are called for. The other key attributes are both integrity and back-bone to be able to withstand pressure from sales teams and, ultimately, to regard the firm itself and its regulator as one’s masters.”

FinanceFeeds spoke to a law firm that recruits compliance officers whose representative went into great detail about how the recruitment process looks for the best qualities in compliance executives.

“The qualities we look for are slightly different than the qualities of an in-house compliance for an FX firm. We are consultants on compliance matters servicing clients so our work is performed in a different scope. For FX companies, that particular company recommends that the Compliance Officer they hire has the following characteristics among others:

1. Has proven knowledge of the sector (knows all the different operations of an FX broker)

2. Has excellent interpersonal skills

3. Is analytical

4. Possesses necessary qualifications (such as CYSEC exams or other equivalent professional qualifications)

5. Has previous experience on the role

6. Able to assess the quality of work performed in his previous positions

7. Be up to date with regulatory developments

8. Has excellent writing skills

9. Be diligent

10. Has good reputation and communication with the regulator

Indeed, it is absolutely the most critical time for the regulatory sector since inception, and for those professionals with a comprehensive understanding of today’s landscape it is a case of goodbye to the grey suit, hello to the high-tech future.

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