Internal Compliance Officers Get More Respect as Demand Surges
Wall Street is scrambling to hire internal cops even as overall payrolls are slashed to get costs in line with shrinking post-boom revenue.
Compliance officers, who make sure firms adhere to securities regulations, used to be looked at as a bunch of dusty drones toiling in obscurity in back rooms.
But now, they’re a hot growth industry. Banks are looking to raid one another’s staffs, and even traders who used to pocket millions of dollars a year are considering switching careers amid the stock market slump.
“For the first time, I see traders asking, how can I go into compliance?” said Jack Kelly, managing director of Compliancejobs.com, a division of executive search firm Taft Associates Inc.
Demand for compliance officers is up because banks need to comply with new regulations, such as laws to stop money-laundering and the USA Patriot Act, that aim to cut off money flows to extremist groups after the Sept. 11 attacks. Brokers now are required to conduct more checks on their customers to avoid being used for illegal schemes.
Another factor driving the hiring boom is a steady stream of investigations into alleged wrongdoing on Wall Street, including charges of crooked stock trading, analyst conflicts of interests and back-door deals with companies that imploded, such as energy company Enron Corp. and telecommunications firm WorldCom Inc.
“It’s not one of those glamorous jobs and was not in high regard, but now they are given the respect that they deserve,” said Rita Kohn of Stamford, Conn., recruiting firm Dawn Taylor Associates, who saw an upswing in the compliance area, mainly from top-tier firms. “There is a lot of pressure on them to protect the interests of the firm and navigate it through the choppy environment.”
Regulators, criminal investigators and attorneys hired by irate investors are going over Wall Street’s books and operations with fine-toothed combs. The exchanges also are keeping a sharper eye on the industry: The National Assn. of Securities Dealers will add as many as 60 investigators and attorneys.
Adding compliance staff will be a long-term trend because of the globalization of financial markets, said Ken Froewiss, professor at New York University’s Stern Business School.
