Exigen Group, a San Francisco-based business solutions company, is offering to brokeragefirms, investment advisers, and other dealers a set of services that electronicallytracks the life cycle of documents, renders them compliant with new federal regulations,and enables supervisors and managers to access them from an outside location, said TomEmbrogno, brokerage and security specialist at the firm.
"All of the retention services can be matched by other vendors," said John Brackett,president of Talbot Financial Network, which signed a contract with Exigen for themanaged service product. But he added that the product is noteworthy because of Exigen'sInternet-access password protection service, which allows outside managers to access theinformation.
Dubbed the "Exigen compliance process backbone," the product is also able to shut outusers electronically if Securities and Exchange Commission compliance requirements arenot met. "If it's a municipal bond and the broker doesn't have the proper license, thesystem will kick it out," Embrogno said.
Other firms offer products that track the life cycle of documents, but products ensuringcompliance and outside access are less common. Spokesmen at Bloomberg LP and ThomsonFinancial said they were not aware of such products being offered by their firms.
Tracking the life cycle of documents is not new, but in the past, whenever it was doneonly on paper, managers had limited access to files when not on-site.
Switching from paper to electronic was desired because supervisors often had difficultyoverseeing day-to-day activities and reviewing transactions in a timely manner, Brackettsaid.
Timing was a factor, because firms' compliance departments had experienced delays inreviewing transactions placed by brokers prior to execution. With the new product,departments that carry out such tasks can preview or look at the transaction documentsimmediately, Brackett said.
"In today's market, you can't be waiting for that approval process," he said.
The Exigen compliance service includes imaging, archiving, retention, retrieval, andsecurity of all communication documents required for a firm to be in compliance with SECrules involving electronic documentation.
The system allows users to "know who touched a document, when it was touched, and whatchanges were made," Embrogno said.
Brackett said the system can be customized to suit each user's needs.
The target market is any financial services firm that is bounded by SEC regulations anddeals in stocks, bonds - including municipals - and insurance vehicles. The managedservice contract allows Exigen to manage the entire process from its central office,whereas its previous software was overseen and maintained by the customer from its ownoffices, Embrogno said. As a result of the service's central location, customers will beable to access it from anywhere, simply by tapping into its computers.
"Companies in the financial services sector are coming under increased scrutiny byregulators," said Greg Shenkman, chief executive officer of Exigen, in a preparedstatement. "Our solutions for financial services are designed to improve profitabilityby lowering fulfillment and service costs while speeding core business processes. Bytaking over their underlying support processes, we allow our customers to focus on the remainder of the profitability equation - growing revenue and providingdifferentiated services to their clients."
Embrogno declined to disclose pricing.
Brackett said, "The price probably takes your breath away, but it is the backbone ofdata retention and business processing."
