ADP Brokerage Services has launched a customer identification and compliance platform through partnerships with Mantas and RemitPro, designed to help firms comply with the USA Patriot Act, as well as SEC and NASD regulations.
Both application are integrated with ADP's Brokerage Processing Services' ASP-based securities processing system.
ADP has teamed with Mantas to provide a hosted regulatory compliance service based on Mantas' Behaviour Detection Platform. The service automatically alerts staff to potential violations and provides a browser-based interface for managing and tracking alerts, from initiation through investigation to closure. A complete audit trail of each suspicious incident is automatically produced and archived.
The service bureau system is available in three versions - anti-money laundering (AML), broker/employee compliance and trading compliance. Each version comes with a set of scenarios developed by Mantas for detecting suspicious patterns of behaviour.
The AML service detects "behaviours of interest" such as transactions involving high-risk geographies or entities, detecting anomalies or changes in account behaviour and rapid movement of funds.
The broker compliance system detects behaviour consistent with front-running, trading a security on a restricted list or watch list, violation of short-term trading restrictions, trading on insider information and other potentially illicit, unethical or illegal activities.
The trading compliance version has a set of scenarios that address illegal trading in equities, options, fixed income and other markets. The system monitors trading and market making activities with respect to regulatory compliance and best execution.
The platform also includes scenarios specifically designed for mutual fund compliance such as detection of late trading, market timing and breakpoint monitoring.
ADP's new customer identity verification system was built in partnership with RemitPro and enables firms to verify customer identities in accordance with the USA Patriot Act and securities industry best practices.
The system utilises RemitPro's Risk Alert tool, which receives customer identification information through a direct interface with multiple vendor and public databases. The service also features a Web accessible case management tool with built-in exception handling and complete audit trail functionality.
Separately, brokerage firms H.C. Denison Company and CNBS have signed up to ADP Securities Industry Software's (SIS) outsourced real-time straight-through processing brokerage accounting system (BAS).
The companies also contracted for other products including ADP/SIS's Order Management System (OMS), premier browser-based broker desktop application Posse, and fixed income trading system OLOS.