Financial Services: Regulatory and Compliance

BakerHostetler’s Financial Services Regulatory and Compliance team is a nationally recognized leader in helping financial institutions navigate an increasingly complex and rapidly changing regulatory environment. Our team includes former in-house counsel, compliance officers and federal and state regulators, giving us a practical, insider perspective on how the financial industry operates and how regulators think. We advise a broad spectrum of clients, including banks, credit unions, trust companies, insurance companies, investment advisers, family offices, private funds and fund managers, broker-dealers, private lenders, mortgage lenders, timeshare lenders, introducing brokers, futures commission merchants, money transmitters, payment processors, prediction markets and fintech companies. By working closely with business teams, we act as a seamless extension of our clients’ legal and compliance functions, helping them design, launch and provide financial products and services in an efficient and compliant manner.

360° View of Industry Risks. We help clients stay ahead of emerging risks presented by the increasing adoption of technology and the constant shift in enforcement priorities. Our team brings deep experience in designing and implementing regulatory compliance and enterprise risk management programs customized to each client’s specific business model. These programs are built not only to prevent violations but also to mitigate exposure to liability, including risks arising from third-party relationships.

Outside General Counsel Services. Act as outside general counsel to financial services firms – including broker-dealers, private equity and hedge fund managers, money services businesses, digital asset companies and fintech companies – to structure compliance programs and business products and offerings and negotiate transactions by addressing securities, commodities, data privacy, information security, payment issues, and FINRA regulations.
Regulatory Examinations. Counsel investment advisers and broker-dealers in connection with SEC and FINRA examinations – focusing on valuation, trade execution, marketing disclosures and compliance with data privacy and security, Regulation S-P, Regulation S-ID and the Business Continuity and Custody Rules – by preparing executives for and representing them during regulatory interviews, supervising document collection and production, and guiding clients’ responses to the questions and concerns of the examinations team.
Cybersecurity and Privacy Guidance and Response. Advised more than 100 financial services firms – including banks, insurance companies, broker-dealers and investment advisers – on compliance with GLBA, Regulation S-P, FCRA, Regulation S-ID, NYDFS Cybersecurity Regulation and other federal and state data privacy and cybersecurity regulations, including revising policies and procedures, drafting incident response plans, conducting tabletop exercises and training, negotiating agreements with service providers, managing website compliance and updating disclosures relating to risks and incidents.
Consumer Finance Providers. Counsel financial services providers on compliance with TILA, RESPA, ECOA, FCRA, FDCPA and other federal consumer protection laws, analyze applicability of state licensing laws to various financial products and services, and draft consumer-facing agreements, terms and conditions, and disclosures.
Risk Assessments and Compliance Program Tailoring. Conduct enterprise risk assessments and revise compliance programs, including preparation of policies relating to codes of ethics, information security (WISPs), insider trading and market manipulation, AML and sanctions, anti-bribery and anti-corruption, political contributions, crypto and artificial intelligence (AI).
Anti-Money Laundering and Sanctions. Tailor AML, sanctions and cybersecurity programs for various BSA-regulated financial institutions – including online sportsbooks, casinos, broker-dealers, trust companies, Web3 and DeFi applications, and money transmitters – to address novel issues relating to digital identity, assets and services.
Fund Guidance. Advise all types of funds – including hedge, real estate, venture and fund of funds – on transactional due diligence and securities law compliance relating to disclosures, valuation, marketing and other issues.
Broker-Dealer Counsel. Counsel placement agents, introducing brokers, executing brokers, and alternative trading systems on compliance with SEC and FINRA regulations, including supervisory systems, outside business activities, private securities transactions, material associated persons, member applications, the Customer Protection Rule, the Net Capital Rule, and Regulation Best Interest.
Regulatory Outreach and Advocacy. Draft comment letters to the SEC, FinCEN, and other federal agencies on emerging regulatory issues, including safeguarding and money transmission of digital assets, and interface with staff on such issues.
Digital Payments. Advise multiple parties operating digital payment solutions – including prepaid and gift cards – on compliance with Regulation E, BSA and FinCEN AML regulations and unfair, deceptive or abusive acts or practices (UDAAPs).
Payment Processing. Counsel companies on credit card surcharge programs, payment authorizations, recurring payments and other payment processing issues under federal and state laws, the National Automated Clearing House Association (Nacha) Rules and the credit card network rules, including PCI DSS.
Digital Identity Solutions. Advise digital identity service providers on compliance with federal, state and international laws in providing identity verification and KYC solutions to mitigate customer fraud, money laundering and terrorist financing concerns.
Emerging Technology Governance and Implementation. Counsel financial institutions and service providers on implementing governance frameworks for AI and other emerging technologies and deploying such technologies within the business in compliance with applicable laws, including the GLBA, FCRA and state laws governing emerging technologies.
Regulatory Due Diligence. Assist large financial services companies with due diligence reviews and change-of-control analyses for acquiring regulated entities, including investment advisers, broker-dealers, money transmitters, insurance companies, banks and consumer loan companies.
Private Lending and Alternative Business Structures. Counsel private funds on state lending laws, litigation finance and alternative business structures.
Big Data for Alternative Investments. Advise quantitative investment research firms, alternative data brokers and AI firms on corporate governance, cybersecurity, data privacy and securities law compliance relating to the compiling and sharing of information with financial services firms.
Prediction Markets. Advise an online gaming company and sportsbook on the expansion of its loyalty/rewards program and prediction market business, including compliance with AML and sanctions regulations as well as FTC and state regulations relating to marketing and advertising.
FDIC-Insured Deposit and Cash Sweep Programs. Counsel a trust company, a broker-dealer and other custodians on cash sweep and FDIC-insured deposit programs.
Financial Planning Platforms and Online Markets. Advise financial planning platforms and online markets on compliance with data privacy, cybersecurity, payment and securities laws relating to products and services adjacent to financial services.