The Resonance Test 101: Navigating the Convoluted Web of Compliance

"The chaos we're seeing is really a reaction to the fact that the regulators have floated these enormous boats that are gathering tons of data, over 100,000 points of data in the EU alone. And they've now cut across that with a simplification directive," says PJ Di Giammarino, CEO of RegRisk, as our panel of experts settles in. Di Giammarino is joined by Michael Nicholls, Principal of Financial Services Consulting at EPAM and Chris Owers, a Senior Director at First Derivative. Together, the trio has decades of experience in consulting and navigating the rigors of regulatory compliance. Chaos isn’t a word you want to hear when discussing compliance with pending regulations, especially in the financial services sector. But it’s become a reality for thousands of banks across Europe and the UK thanks to last-minute pivots and sharp turns in dual-tracked MiFID 3 regulations originating from both regions. Meant to drive standardization in trade and transaction reporting, regulators from both regions have had to pump the brakes as the intent of their proposals bumped up against reality, resulting in a temporary pause. "I think a lot of people breathed a sigh of relief. There is a lot of complexity in what's being proposed. I don't think it was a complete surprise if you look at what's happened with other regulations,” says Nicholls. Owers follows this up with a question on how the differences between the UK and European versions – a divergent approach to regulation – are tangibly impacting clients. Nicholls responds, “if you're in a two-tier, two-speed environment where you've got to satisfy regulators in the EU and regulators in the UK, and those regulators become increasingly divergent no longer aligned, you’re going to need more complex systems, data and processes to deal with two environments.” With this, the conversation shifts into how organizations can deal with these complex systems, touching on everything from technology and AI to the shortage of talent within the industry that’s both tech-savvy and versed in regulatory compliance. Ultimately, however, our speakers leave the conversation on a positive note, confident that today’s sprint toward AI can help organizations to even the odds in the great regulatory compliance race. As Giammarino says: “This is a time for organizations to put in robust proofs of concept and begin scaling so they can turn the rulebook into a runbook.” Listen carefully, and watch out for galloping insights! Host: Chris Tapley Engineer: Kyp Pilalas Producer: Scott MacAllister Executive Producer: Ken Gordon