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Chinese Walls: Protect the InformationAll listings are the responsiblity of the posters; keep in mind, anyone can post anything! |
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Chinese Walls: Protect the InformationAll listings are the responsiblity of the posters; keep in mind, anyone can post anything! |
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Privacy and SurveillanceChinese Walls: Protect the Information
Running a financial services firm can be a tricky business. There's a lot of information to protect due to the nature of the business. In a highly monitored business such as this, there are a lot of policies taking into effect to ensure fair treatment of clients and to avoid distortion of the market. A high-impact business such as financial services require fully dedicated professionals who are experts at both running a financial firm and its legal complications.
In the short time I have spent at an investment bank, one of the greatest lessons I have learned about privacy and risk management is the concept of Chinese walls. Simply put, a Chinese wall is an information barrier within the same firm that is used in order to protect insider information related to one business from influencing investment decisions of one business within the same firm. Financial service companies typically have two sides: a public side which basically deals with stock trading and investments, and a private side which handles consultancies with companies regarding potential merges, acquisitions, and other information that are considered confidential. In order to avoid scenarios where there is a conflict of interest, governments and financial firms put up Chinese walls. As we all know, insider trading is a very serious offense. No decent company would want to have reputational damages by failing to uphold Chinese walls. Chinese walls serve not only as a company-wide restriction to disclose unneeded information to other businesses. Sometimes it can translate to physical barriers, such as different buildings or different floors to avoid any doubt. There are some branches of a company that do not have any choice but to access information in the private and public sides. For example, the IT arm of such a company will have to access the information in order to provide their services. In this case, there's got to be more stringent monitoring of information transferring within these firms. As mentioned above, running a financial services firm, especially an investment bank, is a tricky thing to do. This post does not in any way serve as reputable advice, but it pays to learn some know-how in running an investment bank. Of course your best recourse is to consult a lawyer specializing in trading laws to know how Chinese walls should be implemented. You can talk about... Chinese Walls: Protect the Information Tags: • risk • complications • insider trading • stock trading • service companies • financial service • risk management • fair treatment • financial services • information • bank • investment • chinese • conflicts • how to • chinese walls • Related articles:
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