Financial services organizations that provide investment advice and sell life insurance, annuities and other wealth management products are finding that regulators are increasingly monitoring the behavior of advisers.
To help these companies reduce the risk of non-compliance, NICE Actimize, a NICE company (Nasdaq: NICE), today announced the launch of SURVEIL-X Suitability for Wealth and Insurance, a comprehensive monitoring and reporting solution. AI-based fit that builds on the capabilities of NICE. The industry-leading SURVEIL-X holistic driving monitoring platform from Actimize.
Already adopted by a number of leading global FSOs, SURVEIL-X Suitability combines communications oversight, sales practices and suitability, and best interest regulatory oversight (Reg BI) into one platform. -integrated cloud native form.
A growing body of global regulations and guidance puts pressure on financial services organizations to more closely monitor regulated employees; examine their investment recommendations, transactions and accounts to verify their suitability and undue risks; and ensure that mandatory disclosures are properly communicated. These regulations include FINRA Rules 2111 and 3110; Investment Industry Regulatory Organization of Canada (IIROC) Rule 1300; the best interests of SEC regulation; the client-centered reforms of the Ontario Securities Commission (OSC); the Monetary Authority of Singapore guidelines on private banking sales and advice; and the adequacy requirements of the Securities and Futures Commission and the Hong Kong Monetary Authority.
“As regulatory complexities increase, this places a huge burden on compliance organizations and increases exposure to risk,” said Chris Wooten, executive vice president of NICE. “As an end-to-end cloud native solution designed to meet these regulatory requirements, SURVEIL-X Suitability covers a wide range of supervision and monitoring challenges and ensures that advisors provide advice and sell insurance products and investment in a consistent manner. with customer suitability profiles. By automating the monitoring and oversight of sales practices, SURVEIL-X Suitability reduces resource consumption and costs, while protecting businesses from regulatory violations, fines and reputational damage.
SURVEIL-X Suitability extends the benefits of SURVEIL-X Holistic Conduct Surveillance to wealth management, mutual fund, pension and insurance companies by expanding these capabilities:
New risk detection models that detect adequacy and best interest deficiencies related to life insurance, annuities, account refinances and insurance policy loans. SURVEIL-X Suitability leverages SURVEIL-X’s advanced anomaly detection, AI-driven analytics, and a robust collection of out-of-the-box risk detection models. New insurance models rely on a client’s financial resources, detect spikes in replacements, surrenders or withdrawals related to specific advisors and accounts, and look for other telltale signs of behavior at risk. risk (for example, when customers take out long-term loans insurance policies to purchase other investment products). SURVEIL-X Suitability also incorporates Reg BI-centric models that monitor appropriate disclosures and recommendations.
Self-development capabilities that allow companies to easily build, test and deploy custom analytical models to meet unique business needs and new regulatory requirements. Companies can incorporate additional checks and balances into their monitoring programs by adapting models to identify advisers with excessive alerts who should be under enhanced monitoring.
Automation of monitoring and supervision of regulated employees, risk assessment of transactions (based on client suitability information) and review of investment recommendations and disclosures. SURVEIL-X Suitability automatically alerts compliance analysts to risk and enables them to investigate effectively.
AI-powered disclosure reviews to assess and confirm written and verbal disclosures have been presented to clients. Using natural language processing and advanced communications monitoring capabilities, channels such as email, SMS, chat, phone calls and CRM notes can be analyzed and compared to the required disclosure text to highlight potential gaps in appropriate communication.
Momentum is also building in the United States at the state level as more localities create regulatory frameworks, such as New York Regulation 187, which requires New York businesses to sell life insurance policies. to act in the best interests of their clients. In addition, many states have adopted the National Association of Insurance Commissioners (NAIC) Model Regulation 275 on Adequacy of Annuity Transactions, which also imposes a “best interest” standard when recommending annuities. This regulatory model requires companies to establish reasonable procedures to detect inappropriate recommendations.