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News January 18, 2010 Issue

2009 Was Hard

For starters, it followed 2008 and 2007.

As the landscape has changed and belts have been tightened, we’ve been wondering how firms have been handling it.

When we asked around, all the usual suspects were there - downsizing staff, cutting programs, doing more with less.

"It was a good exercise in trying to really trim the fat," said one CCO. There is definitely a lot of pressure, and in this environment someone’s got to be worth every penny they’re paid.

Another CCO said they conducted a line-item review to ensure all the firm’s compliance resources were fully employed. The compliance program passed the test.

One compliance professional said their program has remained unchanged.

The folks we talked to all believe their firms have a healthy respect for and understanding of the compliance function. Even so, they are not immune to the times. One firm reduced staff in favor of automated programs. Another turned one high-paying slot into two lower-paying ones and actually increased the firm’s surveillance capabilities.

Still, the belief is strong that no further reviews or cutbacks will come, at least in the near future. Financial regulatory reform will become law sooner or later, and compliance programs are bracing for all the new regulations it will produce.