Doug Cornelius, who tackles compliance and business ethics matters each day on his Compliance Building Web site, admits that, while the Chief Compliance Officer should be a model for employee conduct, not all CCO's succeed in this role and some get disciplined by the SEC and FINRA.  That, combined with the fact that regulators are increasingly holding CCO's (and for that matter, supervisory personnel) accountable for alleged infractions at their brokers-dealer and investment adviser employers, prompted Mr. Cornelius to illustrate situations where CCO's have been disciplined for allegedly running afoul of their obligations and/or with securities rules and regulations.

Mr. Cornelius also provides links to valuable sources - which include publications from Sutherland's Brian Rubin and Katherine Kelly, and Alston & Bird's Theodore Sawicki and Kerry Vatzakas.  Among the many topics covered by Mr. Cornelius and his various sources:

• Participation in Wrongful Conduct
• Failure to Supervise.
• Reliance on Pre-Packaged WSP's and Other Manuals.
• Failure to Control Email.
• Failure to Conduct Background Checks.
• Failure to Heed Red Flags.
• Acting as a CCO Without Proper Qualification.

Rather than write about these issues - many of these same cases were reported in Compliance Insights - we encourage C-I Members to click these links and read the publications for themselves.  We suggest you start with these three: 

• Disciplinary Actions Against CCO's - Cornelius, 11/9.

• While You Were Complying: SEC and FINRA Disciplinary Actions Taken Against CCO's - Sutherland's Rubin and Kelly, Fall 2010. 

• CCO Liability: Setting the Record Straight - Alston & Bird's Sawicki and Vatzakas, March 2009.