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FINRA to Increase FinTech Engagement, Move More to the Cloud

The regulator wants to more proactively engage with people in the industry developing or using new financial technologies, FINRA President and CEO Robert W. Cook announced at its annual conference in Washington, D.C.

The Financial Industry Regulatory Authority is launching the FINRA Innovation Outreach Initiative to help the self-regulatory organization better understand technology innovations in financial services.

The regulator wants to more proactively engage with people in the industry developing or using new financial technologies, FINRA President and CEO Robert W. Cook announced at its annual conference in Washington, D.C. on Wednesday.

“It may also allow us to identify areas where we may want to consider adapting our regulatory approach to take into account evolving business models and risks,” Cook said.

FINRA’s Blockchain Symposium, to be held July 13 in New York, will be the first step in the outreach program. The half-day event will bring people together to discuss the use of blockchain and related opportunities and challenges.

Cook said FINRA will continue to invest in its own technology. For example, the organization plans to move the bulk of its remaining applications to the cloud over the next three years. (Its market regulation platforms are already operating on the cloud.)

“This transformation will improve our ability to provide new regulatory capabilities and to conduct regulatory tasks more timely and efficiently, all in an operating environment that provides equal or better security,” Cook said. “The improved automation, and the fact that we no longer have to provision for peak times and can purchase only the capacity that we actually use, will also allow us to reduce costs in a meaningful way.”

Separately, Cook discussed feedback he received on his “listening tour,” and the progress toward its FINRA360 initiative, a widespread review of its operations and programs, announced this year. As part of that initiative, Cook announced a new Regulatory Operations Oversight Committee, which will allow the board and staff to evaluate examinations and enforcement operations. He also announced that over the next two years the regulator will “substantially increase” spending to improve the onboarding of new examiners and the training of those examiners.

“In addition, we are advancing a series of more incremental improvements to these programs, such as implementing an organization-wide policy that encourages the use of video conferencing for on-the-record interviews, which should reduce costs for both FINRA and firms,” he said.

TAGS: Technology
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