Finance professionals are subject to some of the strictest compliance regulations of any industry. Financial compliance requirements are put in place by the government to protect the safety and well-being of both you and your clients.


As a CPA or financial advisor, you need to have a proactive compliance and risk management strategy in place. 


In this article, we’ll talk about why compliance is so important in financial services, as well as the regulations you need to know as a CPA.


Key Takeaways

  • Financial organizations are required to comply with laws and regulations that apply to their operations.
  • Financial regulations are put in place to protect consumers and prevent financial crime.
  • Many of today’s financial regulations focus on preventing digital data breaches and protecting consumer data.
  • Financial compliance in the US is overseen by a mix of government agencies and non-profit organizations, including the SEC, FINRA, and CFTC.
  • Working with a managed services provider can help you ensure that your systems remain in compliance.


What is the Role of Financial Compliance?

Regulatory compliance standards have been established to keep the broader financial system safe. These regulations help prevent financial crimes and ethical issues.


Since many financial services are provided online these days, many modern compliance regulations focus on cybersecurity and keeping personal data secure. 


There are also many regulations that focus on keeping the financial markets stable and preventing devastating economic crashes.


When financial services organizations fail to comply with regulations, it leaves both their business and their clients vulnerable. 


Failing to comply with government regulations could put your clients’ sensitive data at risk and damage your reputation. It could also leave your business vulnerable to fines or even legal action in severe cases.


For larger businesses, having an in-house compliance officer is the easiest way to make sure you’re adhering to these regulations. This is a professional who is deeply familiar with compliance solutions and can implement a risk management strategy.


Small businesses may not have the resources available to hire in-house compliance staff. However, you’ll still need strategies in place to adhere to important financial regulations. In this case, outsourcing compliance is often the most efficient option.


Who Oversees Financial Services Compliance in the U.S.?

Financial Services Compliance in the U.S

There are several government organizations that oversee compliance for financial services organizations in the United States. 


It’s important to understand what these organizations do and how it could affect your business.


Commodities Future Trading Commission

The Commodities Future Trading Commission, or CFTC, is a government organization that regulates the derivatives markets. 


Derivatives include stocks, bonds, currencies, and commodities — essentially, any publicly traded investment that is backed by underlying assets. The CFTC also regulates futures and options contracts on these derivatives.


The CFTC handles many different regulatory activities. These include, but are not limited to:


  • Ensuring that transactions on derivatives markets clear
  • Ensuring that the markets remain free and competitive
  • Educating consumers on risky or unethical investment products
  • Investigating potential fraud or violations of current commodities regulations


In recent years, the CFTC has focused heavily on regulating new cryptocurrencies. The organization also regulates fintech tools that affect the derivatives markets.


Financial Industry Regulatory Authority

The Financial Industry Regulatory Authority, or FINRA, enforces regulatory requirements for finance brokers and broker-dealers. Unlike the CFTC, it is a private not-for-profit organization rather than a government agency.


FINRA focuses on investigating and disciplining instances of fraud and insider trading. Discipline usually involves charging fines to perpetrators and facilitating restitution to investors who have been victims of fraud. 


They also administer certifications, which are mandatory to start a career as an investment broker.


FINRA also provides resources for investors to help them find trustworthy brokers. For example, FINRA’s BrokerCheck platform allows investors to find important information about brokers before working with them to reduce their compliance risk. With BrokerCheck, investors can verify a broker’s education and certifications. 


Investors can also use BrokerCheck to see if FINRA has taken disciplinary action against a broker in the past.


Securities and Exchange Commission

The U.S. Securities and Exchange Commission, or SEC, is another government agency that regulates the investment markets. The agency was established as a result of the Great Depression to prevent devastating stock market crashes from happening again.


The SEC’s operations are broad, encompassing individual and institutional investors, mutual funds, brokers, investment advisors, and anyone else involved in the securities markets.


One of their largest goals is to protect investors from fraud. This involves verifying that companies who sell securities to consumers are legitimate. 


The SEC also regulates investment exchanges, brokers, and dealers for this purpose.


The agency also penalizes and helps prevent insider trading, money laundering, and other unethical investment practices. 


The SEC often works with the U.S. Department of Justice on high-profile criminal cases involving securities.


Federal Trade Commission

The Federal Trade Commission is a US government agency designed to protect American consumers. 


It oversees businesses in a variety of industries and works to protect consumers from fraud and deceptive business practices. 


While this organization isn’t finance-specific, they do oversee some aspects of financial compliance, so they are important to be aware of.


What Compliance Regulations Should You Know as a CPA?

Many people assume that compliance regulations are just for large financial institutions, but they’re just as important for small businesses in the financial sector. 


Here are some of the most important compliance regulations to know as a finance professional.


Sarbanes-Oxley Act

The Sarbanes-Oxley Act, or SOX, was passed in 2002 and is designed to prevent accounting fraud among major corporations. This legislation created strict penalties for corporations who violate existing securities legislation. It also requires corporations to adhere to very strict accounting and record-keeping standards. 


This act helps protect shield investors from fraudulent corporate practices.


Gramm-Leach-Bliley Act

The Gramm-Leach-Bliley Act was passed in 1999 and is enforced by the Federal Trade Commission. This legislation requires companies that provide financial products or services to be transparent with their information-sharing practices. 


It also requires them to appropriately protect sensitive financial data.


General Data Protection Regulation

The General Data Protection Regulation, or GDPR, is a regulation put in place by the European Union to protect data privacy. It is the strictest data privacy law in the world. It defines what personal data is, when companies can and can’t collect it, and how data should be processed.


This law is important to be aware of even if you don’t live in the European Union. If you have any operations in the EU, this law will still apply to you. Adhering to the GDPR can also help you better protect your financial information, even when it’s not required.



Payment Card Industry Data Security Standards, or PCI DSS, is a regulatory guideline for companies that work with credit and debit cards. 


These regulations require businesses to keep cardholder data secure by creating and maintaining a secure network. 


It requires businesses to test their networks regularly and put plans in place to address vulnerabilities.



BSA/AML is a broad category of anti-money laundering regulations in the United States. These regulations require banking institutions to have anti-money laundering policies in place to prevent their customers from misusing their products and services.


How Can Tech Advisors Help You Stay Compliant?

As a CPA or other small business in the financial services industry, you may not have the budget to hire an in-house compliance team. 


However, you still need a compliance strategy, especially when it comes to protecting customer data. 


This is where Tech Advisors can help.


Tech Advisors provides managed IT services, cybersecurity, and compliance for companies in the financial services industry. 


Understanding financial services regulations can be confusing, but our team will help you stay up-to-date with regulatory changes and determine which regulations apply to your business.

We’ll help you: 


  • Develop a risk management strategy to stay compliant and protect your systems. 
  • Implement data security measures to ensure that your clients’ sensitive information stays private and secure. 
  • Implement firewalls and other security measures to prevent cyberattacks.


As a managed IT service provider, we offer ongoing system monitoring and intrusion detection for our clients. 


Consistent monitoring also gives us the opportunity to respond right away in the event of a security threat and prevent it from getting out of control.


Tech Advisors uses the CyberGuard 360 platform for comprehensive compliance. With this platform, we can conduct virtual risk assessments, manage and deploy security policies, and conduct security training and education. 


Training and security measures for your team include ongoing awareness training sessions, security video shorts, and simulated phishing attacks.


If you’re looking to improve your business’s financial compliance strategy, Tech Advisors is here to help. Reach out today to book a consultation and learn more.