Hi and welcome. My name is Louis Giannini, Director of Product for the Compliance Group here at Orion and I'm excited to talk to you today about something that I'm incredibly passionate about. We're going to get to talk about game changing technology to reduce risk and pressure for CCO's. Now this is something that I hold close to my heart because. We're going to get to have some fun with this. We're going to get to see something that's brand new, completely innovative from Orion compliance and how it integrates with the broader Orion ecosystem and more importantly, how it powers the advisor client journey. So let's jump on in. So I want you to rewind the clock back to 2001. Yes, 2001, you may have been going on a walk. Or maybe exercising. Or just listening to music in your home. But you were most likely listening with a Walkman or a CD player. And that was great, except for the times that it skipped, scratched, or didn't work, or maybe dropped and it completely broke. You know, Those were the times when things seemed somewhat simple but advanced. But then along came Apple with this really interesting device. Called the iPod, if you remember what it was like, It was just absolutely mesmerizing at the time. It was completely groundbreaking technology. You had this palm sized music device that could hold what seemed like a zillion songs in your palm. It had a little interface and made different noises. It was so compact and so sleek and there was just nothing else like it on the market. And that was truly groundbreaking. But for all the fanfare with the iPod, and I had one myself and absolutely loved it. There were some gaps and some limitations, right? So 1000 songs sounds like a lot, but over time, if you have family, 1000 songs starts to pile up real quick. And then sometimes the iPod would skip. Or maybe the iPod would malfunction and it would not work right. And so, yes, it was amazing. But there was maybe a little more that you would want to be able to do with it. And so Apple was already ahead of the map on this and they said let's introduce something that's completely game changing and that was iTunes. So the iPod was groundbreaking, but it's it really was the catalyst that drove towards iTunes, which was game changing technology. So iTunes as we know is extremely successful. It has allowed users to listen to thousands and thousands and thousands of songs. But most importantly is the reason why the reason why it's game changing is because iTunes. Leverages the synergies within the Apple ecosystem, so it's able to draw on all the strengths of all of the other apps within that ecosystem. It's also able to draw on the power of the Apple architecture in the Apple ecosystem, and that allows it to be a premium top shelf experience at a premium application that has endured for years and years and years. And even if you don't use iTunes and you use, let's say you know, a digital competitor, you've seen same thing, right? So iTunes was completely game changing. It's here to stay. It's evolved from the iPod quite nicely. But this is a pure example how a technology at first that's completely ground scraping and transformative can be game changing by something that's completely down the road and due to to a collective synergies of different strengths and different technologies. So talking about time, right, we just talked about the iPod 2001. Let's talk about Orion's timeline where Orion began. So way back in 1999, a little before the 1st iPod came out, you know, Orion begins its journey and they start, they start to notice, hey, there's there's really a lack of quality portfolio accounting solutions. And so they start, they start exploring you know where they might be able to add value along the way for their clients. And as they move throughout time, they start to use a combination of strategic acquisitions and and organic growth to establish themselves of course as today's wealth tech juggernaut. And one of the most notable points in that timeline comes later on in the 2000s when we get to 2021. And Orion acquires hidden levers and basis code. And this is quite significant for many reasons, one of which is of course hidden levers being a best in class risk analytics platform. But basis code being a complete end to end workflow for compliance and employees offers paralleled opportunities in the future to utilize both hidden levers and basis code throughout the Orion ecosystem. To power technology forward to a new level, so we're talking about the Orion ecosystem. The Orion ecosystem in and of itself is really a confluence point where all of the different applications can leverage each other to increase their strength and become best in class technology applications, not just by themselves but holistically as one solution. So you know many of our clients would say is. You know, hey, I need this, or this is a challenge I'm facing, or this is a gap in my current process. And when they're able to look at the Orion ecosystem in the context of 1 ecosystem, they're quickly able to notice all the strengths it provides and able to strengthen their compliance culture and maximize value of all of their favorite apps. Including Redtail, Eclipse, Hidden Levers, Portfolio, Audit Advisor, Portal and of course now Orion compliance. So this really shows the power and gives a visual context to the Orion ecosystem and how it's been growing throughout the last couple of years. How strong is your firm's compliance culture? This is a question that's ever present and permeates every aspect of your firm from CC, O's and compliance officers we spoke with. This question usually gets asked in different forms, but it always culminates in how strong is your firm's compliance culture. And that's because of the relentless pace of regulators consistently issuing new rules and regulations across this regulatory landscape and how your firm's going to respond. Right. So in terms of your culture, how are you approaching compliance? How are you enforcing compliance? Are you taking a proactive approach? Are you taking a reactive approach? Right. And So what you see here is the ability for firms to shape that culture and institute a culture that's rigorous, thoughtful, complete and proactive. This is one of the most important underpinnings to any firm compliance program in general. But certainly when evaluating potential challenges in any new rules and regulations, I'm talking about compliance culture at firms. You know, I want to introduce you to somebody that's dear to my heart, Adam, the CCO. So Adam is a fictional compliance officer and he has a fictional team around him, and business has been going quite well. Adam has a range of different processes, disparate and fractional, using spreadsheets and other manual processes, but so far so good. There's been no issues. Headcount is good, process is good, business is overall well, nothing much to complain about. But one day Adam receives a letter to perform an external audit, and at first there's a little bit of hesitation and trepidation because. We have to provide all this data. Where do we get it from? It's on this spreadsheet. This person left the firm. We have to go, you know, open that file, put it all together, put it in a correct format and and hopefully submit it to the order and everything's there. So once the results return, Adam and his team are quite pleased because they realize as they go through, you know, most of those items check the box, right? So items, check the box. There's no need to worry. Everything seems well. But once they get further through the audit results, they realized that some items were not sufficient and flagged by the auditor. There were a range of different items, but one of which was shared class review. So Adam was dinged for potentially not providing the best process in regards to a shared class that's most appropriate for his firm's clients. Now this is absolutely vital. To their program in order to prevent future fines and any future issues they might have surrounding this process that will directly impact their clients. So Adam jumps to action, he starts thinking action, what can we do? What action can we take to mitigate this going forward. You know, compliance by itself some of something that magnitude is very nuanced, very complex, so in looking at options. Adam considers firstly adding headcount, so adding additional people to his team. They would come in, they would learn the existing process, they would dig in and find those spreadsheets. They, you know, might go to that person that left the firm, go to their desk and try to figure out where they kept it and glue it all together and, you know, try to get things back on track. The other option would be to leverage technology now with technology. Adam understands that there's a lot of different solutions out there, so he needs to be careful and he needs to be very he needs to be very glued in on what specifically he wants the technology for. Meaning, does he want it to meet? Just one use case or does he want to be a more holistic solution, a more macro solution that captures everything that not only he got flagged on in the audit, but also with also a solution that would grow with him going forward? So as Adam starts his journey and begins to explore, he starts thinking about what do I need in order to to drill down on a solution that's a good fit for my firm. Well, first of all, it has to be automated. It has to be able to do things quicker and to do things faster. Especially in a climate where many compliance departments are being asked to do more with less resources, it needs to be less sensitive to volume and more scalable, which is completely logical, right? So automation being a key, point number one, he also knows that the solution that he might pursue needs to reduce risk. So. From Adam's perspective how can it how can technology mitigate risk. The the landscape is so rapidly evolving around regulators the rapid pace of regulations that are being issued and the added it's not only the rate of regulations, it's the rate of regulations combined with the complexity of the regulations that are being issued. So Adam knows that if he does pursue technology and has to be able to provide a full end to end workflow has to provide timely complete. Information that can be exported on demand, that's regulatory grade and will leave his firm audit ready. And last but not least, Adam knows that he needs to find something that provides an exceptional experience and this being point #3 is may seem a bit underrated, but to him it's very important and here's why. Compliance by itself is a very complex area. There are lots of moving parts, there are lots of updates, there are lots of variables and lots of Gray areas. So in order to take any rudimentary or antiquated process and to you and to sort of. Tailor it towards a technology solution. He knows that whatever he uses has to be smooth and intuitive at scale, not just for him, but for his team and anybody else within his firm that might use it. Because the last thing that Adam would want from any technology is to add any additional burden or complexity to something that's already quite complex. So when thinking about that, When thinking about automation, When thinking about. Workflow when thinking about reporting, when thinking about exceptional experience and mitigating risk, Adam knows that the solution also has to accommodate for workflow. So workflow meaning, hey, I have a team of 10 people or 20 people or 100 people or five people and I need to make sure that one of us. Or or multiple people in a group can participate in the solution, they can work on it together in either in a linear fashion or dynamically, and they need to be able to communicate and document findings, exceptions, and any other meaningful output that needs to be captured within the workflow. In addition to the workflow, Adam knows that the system needs to have reporting and not just any reporting where the report is generated and then somebody at the technology vendor has to be contacted to get the data. He knows the reporting needs to be dynamic where he can filter, add columns, remove columns, sort and most importantly export. So getting the data out, how friendly is that? How quick is that can? I come in different formats like excel, PDF, zip package. Can it come on demand where I don't have to contact anybody else, I can just do it from the comfort of my own laptop. And lastly, what do you have different levels of reporting from basic, maybe a spreadsheet output to something much more comprehensive? Like a zip package which will download everything from the workflow until a nice neat audit ready file to your computer that can conveniently be put on a thumb drive to present internally or to a regulator. And lastly client driven. This is one of Adam's top three criteria when evaluating any technology, not just with compliance but anything in general because. How many times have we all used some piece of technology and you know it quite, It may cost a good bit of money. It's a commitment. We're invested in it, we like it. But there's just those few things, those those handful of items that the technology does not accommodate and there's no Ave. or voice for you to have a seat at the table and shape that conversation. One of the things we pride ourselves on here at Orion is that we are extremely client focused. We're passionate about our clients and the majority of all of our features are client driven. We strongly encourage our clients to be candid. We love to have those conversations and we take that feedback. We seriously actively listen and then we go and evaluate on what suggestions will make the most impact for our clients. So Adam stumbles across a brand new module, Client Oversight. Now Client Oversight is the newest module that's been added to Orion compliance, and it's a complete game changer. And here's why. It automates and streamlines a whole range of complex, manual and previously mundane tasks for compliance, including client trade preclearance, shared class review. Beneficial ownership, large trader account focus monitoring and portfolio drift and we're going to get into that. But most importantly starting with client trade preclearance, the reason that this is such a remarkable piece of client oversight is because it integrates Eclipse Orion's order management system. So here we're seeing those synergies start to come together from the Orion ecosystem. We're seeing Eclipse being integrated with Orion compliance and this is going to provide. A whole new Ave. of different compliance checks and technology that firms can implement to completely automate and streamline any orders being placed in Eclipse. So when using client trade preclearance compliance would be able to set up a whole range of different policy rules within Orion compliance. So for example if your firm prohibits trading of. Inverse or leveraged ETF's if they prohibit trading of a certain issuer or a certain asset class, let's say fixed income. Or they prohibit short term trading where they're trading the same security and the same account within a number of days. Or perhaps they'd like to have an an auto approve list. Or perhaps they'd like to restrict trades by industry sector or custodian. All of those are examples of just some of the rules that can be configured within Orion compliance. And one of the the most interesting parts of that is that the system itself comes with policies that firms can just simply use out-of-the-box. But they can also build their own custom policies around a whole myriad of data points from Eclipse and market data to tailor rules that fit their compliance policy. So once you have all the rules with something like client trade preclearance, one of the most important things and the simplest question is how do I know it actually works. So how do you cultivate that confidence? So you know that, hey, if I'm going to use this brand new technology, you know it's very innovative, very cutting edge, but we're going to integrate it with a client trading system. How can we be confident that it's going to work exactly the way that we anticipate? And So what we've done in Ryan Compliance is actually built out a validation where firms can go and enter fictional trades. The system will automatically process it, compare it to all of your available rules and then let you know exactly what would happen, what action the system would take and why. This is incredibly important. And we here and understand that to ensure that all of the rules that you set up are going to be executed and configured the way that. You've intended so in talking about Eclipse, let's take a little peek at the Eclipse experience, right. So put yourself in the shoes of a trader, somebody placing a trade. So what you're looking at on the right of that pop up screen is a trade was initially rejected, so a trade was placed and in real time an outcome is generated. So as soon as that trade is entered. A message will populate saying Auto Approve or Auto reject. If it's auto rejected, this popup will appear and the client will have a one of two options. They can appeal which means they disagree with the rejection and they can list a reason for the appeal and then send it to Compliance. Once compliance gets it, Compliance can choose to approve or reject that trade the other option. Would be to override it where the trader would still provide a reason for the override that compliance would receive, but the trader is not prevented from moving forward, they can simply just execute the trade. So it's more of a speed bump. But it's worth noting that appealing and overriding our permissions that are enabled for a user with an eclipse, so this could again can be tailored to any firm specific workflow needs. So when a trade request is appealed, workflow will generate. So when it's sent to compliance, workflow will generate. And one of the things that was really important to Adam of regardless of what technology he's going to employ with his firm, whether it's a vendor, whether it's a spreadsheet, is really when you have a lot of information and you're doing a lot of things, it's answering two key questions and answering them quickly. What am I looking at and why am I looking at it? And Adam can quickly answer those questions by looking at the workflow screen on the right where he can see what am I looking at. I'm looking at an auto rejected trade request that was appealed for coin. Why am I looking at it? Because the policy was appealed because it was on the restricted list and he can also see all of the pertinent information including the reason for appeal and the trade details. And beneath that is a timeline where one or multiple people in compliance or any specified approver group can leave comments, findings, findings being the most meaningful. The outcome? Perhaps there was some sort of issue, so an exception can be appended to that finding. Attachments can be appended to comments and findings, and then ultimately the path of action would be to simply approve the request. Or reject the request, in which case the Rep would be notified and they would know they would have the OK or not OK to proceed with that appeal. Trade. So passionately proactive. You know, this is one of the most important slides during this presentation and the reason is simple. Passionately proactive singularly defines what our approach is here at Orion when creating top tier regulation technology or Reg tech. Our view is that we rather be passionately proactive and develop technology that's at the industry forefront, that's at the cutting edge and that's addressing all of these rapidly relentless regulations that are coming out and also on the horizon. Versus a regretfully reactive approach where we're leading from behind, we're developing from behind. And then you know there's regulations that are in place for quite a long time and firms are already being impacted before we take action. We understand that it's paramount not only to our success, but that of our clients and their compliance program that we are passionately proactive because we understand how aggressive regulators can be. Especially when pursuing any potential fines and violations and speaking about regulators. It's no secret or surprise that in 2021, believe it or not, the SEC leveled enough penalties and violations to exceed anything else in history up to that point, again underscoring the reality that the SEC and other regulators. Will, will pursue any and all potential violations within their purview and it's only going to continue, right. And some of this is a product of the the relentless pace of new rules and regulations and it's also a function of the complexity of those regulations, right. So as more and more regulations get produced, the complexity on them. Grows and you have all of these arcane rules and arcane regulations, and there needs to be ways to adapt that. And Adam is cognizant of this. So in the back of his mind, he's thinking, okay, I can hire people, I can leverage technology, I prefer to leverage technology, but the technology has to be quick moving, it has to be adaptive, and it has to be quality. So then we get to share class review. So share class review is just another part of client oversight, and it's a profoundly remarkable part of client oversight because what it does is it's powered by risk intelligence and it will automatically notify you, meaning compliance or supervision team or any other specified approver team when a potentially less expensive share class is available. And So what we're get, what we're going to get to see here is that we're going to get to see the workflow. We're going to get to see a shared class analytics. We're also going to get to see the option that you'd have in utilizing this tool. Now this is an extremely nuanced process, right? Those of you who are doing this manually will, will you know can testify that shared class review is extremely complex. It's quite esoteric that it's not. It's not immediately clear on exactly, you know, what rules are implemented, how they're being implemented in certain cases. And what we've done is try to reduce some of that noise and elucidate some of those unknowns. So you have the ability to both conduct a shared class review by sending it to reps and asking them to review first before compliance or supervision reviews it, or you can have compliance and supervision review it directly without sending it to reps. But either way, the system accommodates for that, as well as a range of different settings where you can tailor your review again against some of those variables. Things like having an approved list. Or things like excluding potentially cheaper options by minimum investment and other criteria. So what you're looking at here is the perspective of what a Rep would see if your firm issued shared class reviews to Rep So reps would be issued a list of funds they're currently holding for their clients and they would need to either recommend to stay with the current fund, exchange it to something else, and then that would get reported back to compliance. So what we're looking at here is what a Rep would see when they drill down further into a shared class review. So on the left hand side, they have their current fund clearly labeled PXWGX. They have all of the pertinent information regarding the fund. They can click on the links in the middle of the page there those two rows to see which accounts within Orion. Are holding those holding that current fund and then of course you have the real core key metrics, your minimum investment, your net and gross expense ratios, your 12B1 feet fee, your sales load and also your transaction fee if if available as well as any notes from the custodian. So this gives the power to the Rep to conduct their due diligence. And clearly see, OK, which one is economically more feasible. And in this case, we have one potentially cheaper option available as an example. But the system itself would actually show up to four potentially cheaper options when and if that scenario exists. So once the Rep finishes conducting their due diligence, they can make the recommendation and provide a reason before sending it back to compliance, of course if it's being issued to a Rep. And what does this do? What does this process allow? It significantly streamlines it, of course. It's reducing a lot of the Excel spreadsheets, a lot of the paperwork. It's centralizing this process in an independent third party Reg tech application where your firm has full access to workflow and audit ready reporting. It also lets you to fully own oversight. You can see if you're if you do decide to send it to reps. You can see what they're doing. Are they making recommendations? Which recommendations are they making? You can go in and comment on those recommendations, You can change them, you can approve it. And most importantly, you can also generate reporting even right from here, depending on the level of granularity you desire. So you may export it to an Excel sheet, or you can export it to a zip package which would download everything in a nice neat folder. Directly to your computer that can be put on a thumb drive for a Rep to I'm sorry for compliance to present internally or send to a regulator and again end to end workflow for shared class. This can't be mentioned enough and I wanted to intentionally mention it again because end to end workflow is a hallmark of Orion compliance. It's something that we ensure is in every facet of the application, and for good reason. The reason is well, internally that compliance can see who is doing something and when down to a timestamp, a date and timestamp. But more importantly, when that reporting is generated for a regulator or internally, everything is there, nice and neat and clean and complete. So for reporting purposes, for internal purposes. But another take away is no matter how your firm structures are processed, whether it's one person working on it or maybe it's multiple people and they go in order or maybe it's multiple people and any end number of people need to approve it first, all of those workflows can be accommodated both share class preclearance and our other modules. So Adam starts to get interested, he starts to get a little bit excited because. Client trade preclearance, he's using Eclipse Okay as a potential fit chair class review. He had the external audit and he did get flagged for that. So this would certainly eliminate the need there and of you know comparing it to let's say building in house. So for him so far that that's upside. Then you get to beneficial ownership and large trader. So another part of client oversight will have beneficial ownership or 13 DAG alerts powered by risk intelligence. So for example, if you are firms owning more than 5% of a company's shares and alert is going to populate, it's going to live in client oversight and it's going to look very similar to preclearance and share class. With complete end to end workflow where you can add your findings, comments and complete it. In addition you have large trader and large trader of course is looking at the client trades that you would import directly from Orion very seamlessly And it's going to look of course at 2 and 20 million, 20 million and 200,000,000 for volume and amount respectively within a day or a month period. And when and if one or both of those thresholds are exceeded, an alert will also be generated with again full end to end workflow and reporting. And last but not least, candidly, this is the one that I have to say I'm most excited about and for good reason. The risk monitor is something we already have, but we are making incredible updates to this tool. We want this to be a a world class tool and what it does today is think of it as as an eye in the sky approach to account monitoring. So what it does is it's looking at all of your client accounts within Orion and it's looking at them on an ongoing basis automatically and it's looking for things that you can configure like. High cash or low trade volume and then it's alerting you to the accounts that are impacted by those configured filters. In addition to account focused alerts, we're proud to announce that portfolio drift will also be a part of Risk Monitor. Today portfolio drift can be measured at the registration level, but due to one of our most exciting and compelling initiatives on the horizon for later this year which is the one Orion risk initiative. We will also be able to unlock portfolio drift at the household and account level. So regardless of how your firm is conducting this process today, we're excited that we'll be able to work with firms in the future to unleash this potential. So we've talked about client trade, preclearance, shared class review, beneficial ownership, large trader risk monitor including account focused alerts and portfolio drift. And now you're starting to have, you know, holistic picture of what's included in client oversight and why it's so unique, why it's so remarkable. This really bookends the, if you'd like to call it, bookends, The Reg tech pyramid of employee oversight where employees are attesting to personal trades client, a firm oversight where you're sending out. Code of ethics. Attestations. Compliance. Acknowledge compliance. Manual acknowledgements. You're sending out, You're maybe you're testing your e-mail program, you're testing your best execution, your adv. You're sending out a MLKYC quizzes. So there's a whole broad range of of items included in the application, but client oversight was always the bookend that needed to be to complete a full comprehensive. End to end workflow Reg tech solution for both clients, employees and the firm. And so here we have an excellent testimonial from Jack Ignatius, the Operations Manager over at MSH Capital Advisors. He has been kind enough. To participate in our beta program for client oversight, our he was able to roll his sleeves up, work with us as an extension of his team, act as his resource to go through client trade, preclearance, share class ownership and large trader and risk monitor. And we're extremely excited and pleased to see that Jack had such a positive experience. You know, we we again I can't stress this enough, you know we're passionate about our clients, we're passionate about regulation, technology and being able to, you know work with all of our our valued clients is is a pleasure because we get to experience all this different feedback which drives us to create a better technology and that's what's happening here. As you can see it's a very positive. Very positive quote. We're very thankful to Jack and his team for participating and hope to work with more firms with client oversight. So say hello to Orion compliance 0 to audit ready in one app and that is a really compelling tagline because. We've been talking about Orion compliance in the context of this new game changing module client oversight that integrates with Eclipse Risk Intelligence portfolio audit in the broad Orion ecosystem, but also makes Orion compliance special is that it's a full end to end workflow solution for compliance and employees. So like I mentioned personal trading for monitoring the activity of employee personal trades. Testing, testing, the controls that make up your compliance program, whether they be an e-mail check or best execution or daily reconciliation of trade reports or forms, if you have advertising review or insider trading to detect the misuse of material nonpublic information. So we're very grateful. We're very humbled to be part of. The spectacular Orion ecosystem. And it's truly amazing to see what has basis code has become and transformed to with the power of Orion. We're extremely excited to see what the future holds, and we certainly hope you'll join us on that journey across The Reg tech frontier. Again, I'm Lewis Giannini. Thank you for your time and we hope to see you on the next one. _1715165624640