Law, Financial Regulation and Compliance
The course treats the following chapters:
I. Legal & Economic Foundations
The first chapter sets the stage with a sound, interdisciplinary introduction and demonstrates – based on real-life cases – that financial regulation is “crisis driven”. The primary objective is to explain the economic rationale for financial regulation and to introduce the concept of “market failure”. Real-life cases where market failures provoked new regulation (e.g. bank crisis, high frequency trading, complex structured products) are used to illustrate economic theory.
II. Principles of Financial Regulation, Supervision & Enforcement
The second chapter introduces the key regulatory mechanisms on how to authorize and supervise financial institutions, such as banks, securities dealers/brokers or asset managers. The chapter also outlines the public goals, strategies, mechanism and sanctions used to enforce breaches of financial regulation.
III. Legal Risk & Compliance in Investment Banking
The third chapter treats the regulatory framework for initial public offerings (IPO) and for the distribution of retail investment products. It focuses on rules for the drafting of product documentation (disclosure), rules for the marketing and distribution of investment products as well as on rules to avoid conflicts of interests and market abuse (insider trading & market manipulation). Wherever possible, the course takes a comparative perspective by analyzing the different regulatory approaches in the United States, the European Union, Switzerland and selected financial centers in Asia (e.g. Hong Kong, Singapore). Most topics which will be illustrated with real-life case studies.
IV. Legal Risk & Compliance in Private Banking
The concluding part of the course is dedicated to the rules & regulations governing private banking services offered to various segments of clients (from retail to professional). The chapter explains the duties arising from the code of conduct rules under EU-MiFID II & Swiss-FINSA and it further gives a short overview on the rules governing the distribution of financial products to retail investors (EU-PRIIPs). The focus lies on strategies to avoid, respectively, manage conflicts of interests, e.g. when it comes to kick-backs and other inducements. Another important part of this chapter treats the highly relevant topics of anti-money laundering regulation & the fight against corruption and terrorism financing. Again, students will analyze real-life cases so as to raise their awareness for regulatory risk with which are likely to be confronted with in their future careers as compliance officers or client advisors working in private banking.
This course enables its participants to identify legal and regulatory risks entailed with «pathological situations» in a banker’s daily business practice – may they arise in the context of private banking, wealth management or investment banking. The course is not limited to the “classical” Compliance topics, such as, anti-money laundering prevention, conduct of business rules or the prevention of insider dealing, but it also raises awareness for the importance of ethical behaviour and of corporate culture in the financial industry.
Teaching will primarily be practice-oriented and interactive, thereby focusing on a number of current real-life cases. Students are encouraged to actively contribute to in-class discussions and they will furthermore be required to deliver a few mandatory written assignments (e.g. reaction papers, discussion of cases) during the semester.
Participants are not required to buy a specific textbook. Reading materials (e.g. scientific publications, policy papers issued by International Organizations, excerpts from the leading international financial press) will be provided on iCorsi.
Oral. Candidates will primarily be asked to analyze cases or to discuss problem questions (e.g. PRO/CON argumentation).