Meeting Professionals at the more than 5,000 financial and insurance companies that fall under the regulatory authority of NASD (formerly the National Association of Securities Dealers, and soon to be renamed the Financial Industry Regulatory Authority when NASD merges with NYSE Member Regulation) have just over six months to ensure that their policies are compliant with new revisions of gift and entertainment guidelines.
The new regulations continue a $100 annual gift limit to prospective customers but dramatically tighten guidelines on business entertainment, said Christopher Myers, former federal prosecutor and co-chairman of thecompliance and governance national practice team for McClean, Va.-based law firm Holland & Knight, at a June seminar in New York sponsored by meetings management technology provider StarCite Inc.
“The old rule allowed ‘occasional perks’ for ‘ordinary and usual business entertainment,’ but that was too loosely defined and led to abuses,” Myers told the 24 corporate meeting planners, procurement executives, and compliance officers who attended the session at the Grand Hyatt.
The new regulations continue to be “interpretive-based,” meaning that companies are allowed to construct their own policies, he explained. However, companies must now document their internal controls in detail and show that they are being enforced by senior management. “It's got to be a real and demonstrable commitment by the company,” he said.
In addition, unlike the old regulations, the new rules apply to customer representatives, including agents, not just direct employees. “Limos and expensive wine” expenses tend to draw the most scrutiny from regulators, and offices overseas must also comply with the regulations, Myers said.