Last week FINRA, the SEC and CFTC issued as joint advisory on business continuity planning. While firms have been required to have BCPs in place for some time now, the aftermath of Hurricane Sandy last October, and the disruption it caused, highlighted BCPs in the mind of regulators. This joint advisory highlights certain points that firms should consider when reviewing their BCPs. It also suggests that firms engage in testing of their BCP as well as conducting training on the BCP with employees to make sure that it can be effectively carried out if a crisis occurs.
The joint advisory offers up what the regulators might consider to be best practices, and poses some practical questions for firms to consider. It does not announce any regulatory enforcement or disciplinary action relating to BCP failures in the industry. Wise folks will certainly understand that with the topic on the regulatory radar, it may be very likely that regulators will be reviewing a firm's BCP with a sharper eye. As such, some extra focus on your firm's BCP might not be a bad idea.