Personal trade monitoring for employee oversight
Trade Monitoring is designed to verify client trades with those of a firm’s employees to identify any trade conflicts per code and/or to monitor employees to make sure they aren’t trading in things that they have inside information.
Roles: CCO, Advisor, Compliance, Compliance Support, Support
Create New Trade Rules
Login as the CCO and set up trade rules by selecting Trade Monitoring from the navigation toolbar and click Trade Rules.
Click the New Rule button.
Enter trade rule constraints and then click the Submit button. This particular trade rule will be denied when used.
Once you have set your trade rules you can edit, archive or change the priority of rules set.
To change the priority of the rules simply drag and drop the rules to your desired order and click the Update Priorities button.
Employee Personal Accounts
Now it’s time to set up employee personal accounts. Select Trade Monitoring from the navigation toolbar and then click Employee Personal Accounts.
If you click on the Employee name you will see the accounts associated with the employee.
Click the Add Account button to add another account to the CCO. Enter the new account details and then click the Add Account button at the bottom of the screen.
The new account will display on the Employee Personal Accounts page. From here you can edit the account, remove the account and view/add transactions.
Employees or compliance team members can view or add transactions for an account.
Click the Transactions $ icon to the right of the new account and then click the New Transactions button.
Add transaction details to the account and then click the Create button.
Here we have 3 transactions associated with the account.
Select Trade Monitoring from the navigation toolbar and select Employee Personal Accounts.
Now that we have created transactions for the account we will link the client account. This is important if a company already has employee/clients set up and you want to add existing “client” (employee) accounts to be monitored.
Click the Link Client Accounts button from the Employee Personal Accounts page.
Select an employee to link to client accounts. This will display a list of all the users in your company.
Select a client and click the Get Accounts button. This will display a drop-list of all the clients for the previously selected user.
You will then be prompted to select the account associated with the user you would like to link. Select an account from the drop-down list and then click the Link Account button.
The account number we linked displays on the Accounts page. Notice the Action icons have changed. From here you can delink the client account from the advisor, edit the account or add a transaction.
In order to make a trade you need to ask permission first. Preclearance allows an employee to get a “green light” or check if a trade would be allowed or not. It allows the compliance team to require that all employee trades be vetted before they are done and get alerts if an employee trades without preclearance.
Select Trade Monitoring from the navigation toolbar and click Preclearance.
You can filter requests that are pending, approved or denied and you can query for a request within a defined date range. For this example I will query for all request since November 8. Click the Search button to execute the query.
To submit a preclearance request click the New Trade Request button. Enter details and then click the Submit button.
The request is placed with a pending status and your compliance team is notified of the request.
Quarterly Transaction Reports
The SEC states code of ethics must require quarterly reports of all personal securities transactions by access persons, which are due no later than 30 days after the close of the calendar quarter.
Select Trade Monitoring from the navigation toolbar and click Quarterly Transaction Report.
You can filter for Approved or Submitted transaction reports, create a new report and approve submitted reports.
Click the New Report button.
Enter query criteria and click the Run Report button.
Transactions for the pre-defined query criteria display. Click the Submit Report button.
A new report is created for the previously defined query criteria. Notice the status is “Submitted”.
To approve the report click the blue hyper-link for the newly submitted transaction report.
Click the Approve button.
The status of the transaction report changes from “Submitted” to “Approved”.
Trade Monitoring has some additional reporting capability.
- Trade Rules Report
- Flagged Transactions