A trio of U.S. financial regulators issued an advisory today on business continuity and disaster recovery planning for investment firms, following a joint review of the aftermath of Hurricane Sandy, which caused U.S. equity and options markets to close for two days in October 2012.
The Financial Industry Regulatory Authority (FINRA), the Securities and Exchange Commission (SEC), and the Commodity Futures Trading Commission (CFTC) issued the advisory to encourage firms to review their business continuity plans, in order to help them to improve their responses to, and reduce recovery time after, these sorts of events.
The advisory suggests best practices in areas such as: preparing for widespread disruption, planning for alternative locations, telecommunications and technology, communication plans, regulatory and compliance considerations, and, reviewing and testing these plans. The regulators say that firms can strengthen their business continuity and disaster recovery plans by implementing these practices.
“With hurricane season underway, and with the problems from last year fresh in mind, we trust that our member firms will review their business continuity planning procedures against these best practices,” said FINRA executive vice president, Grace Vogel.