Preparing for your state exam: experts offer pragmatic advice
Some state examiners feel that multi-state exams are a more efficient process today than they were several years ago. The question is: are they better for industry? Some say worse; others say better. But all agree, there are still some drawbacks such as the lack of uniformity or examiners not requesting the same material from state to state.
Compliance experts came together on a panel at AFSA’s first Law & Compliance Symposium last month with a check list for companies to use to prepare for state examinations whether they take place in one state or across several states.
Panel participants were: Jack Konyk, Executive Director of Government Affairs at Weiner Brodsky, Kider PC; Haydn Richards, Partner, Bradley Arant Boult Cummings; John Socknat, Partner at Ballard Spahr; with Matt Kownacki, Manager, State Research & Policy for AFSA, serving as moderator.
Konyk, a former mortgage lender, and the other panel members, offered straightforward and pragmatic advice:
“Get ready by being ready all the time, Konyk said. “Be ready by how you run your business every day.”
The panelists all shared their “do’s and don’t’s” of getting ready for a state exam:
- Know what is in your files; are you a compliant institution?
- Have an exam plan whether it’s a state exam or a pitch to potential investors.
- Reach out to the appropriate players in your organization: Operations, Legal, IT, etc.
- The “Complaint Log” will be asked for by the examiners. Know what’s in it.
- Treat the Complaint Log as free advice on your mission statement. It gives you the opportunity to figure out the process that’s broken.
- Timeliness is key: hit your deadlines for the examiners. Their exam schedule is organized a quarter in advance.
- You do NOT want to be the company that impacts the examiners’ travel schedule. Always be measured and timely.
- Don’t be adversarial. Set a positive tone early; a positive attitude goes a long way.
- Constant Communication: Let them know if you are going to miss a deadline.
- Take the exit interview seriously and correct mistakes.
- Explain your business model as it relates to Compliance issues.
- Ask questions of the examiners if they appear confused about your business model.
- Let them see who you are as a person and a company.
- Turn time for requested documents; let the examiner know immediately if you will be late in producing a requested document
- Finally, be open and honest with the examiner.
February 15th, 2018 by Dan Bucherer