1/1/2017 to Current
As a registered investment adviser, Banker Investment Group must comply with SEC Regulation S-P (or other applicable regulations), which requires registered advisers to adopt policies and procedures to protect the “nonpublic personal information” of natural person consumers and customers and to disclose to such persons policies and procedures for protecting that information.
In addition, our firm’s policy, to the extent applicable, is to comply with the FTC’s FACT Act / Red Flags Rule to require covered entities to develop and maintain an effective client identity theft prevention program. Further, and as a SEC registered advisory firm, our firm must comply with new SEC Regulation S-AM, to the extent that the firm has affiliated entities with which it may share and use consumer information received from affiliates.
Banker Investment Group must also comply with the California Financial Information Privacy Act (SB1) if the firm does business with California consumers.
The purpose of these Reg S-P requirements and privacy policies and procedures is to provide administrative, technical and physical safeguards which assist employees in maintaining the confidentiality of nonpublic personal information collected from the consumers and customers of an investment adviser. All nonpublic information, whether relating to an adviser's current or former clients, is subject to these privacy policies and procedures.
Any doubts about the confidentiality of client information must be resolved in favor of confidentiality. For Reg S-P purposes, nonpublic personal information includes nonpublic “personally identifiable financial information” plus any list, description or grouping of customers that is derived from nonpublic personally identifiable financial information. Such information may include personal financial and account information, information relating to services performed for or transactions entered into on behalf of clients, advice provided by Banker Investment Group to clients, and data or analyses derived from such nonpublic personal information.
The Federal Trade Commission’s FACT Act / Red Flags Rule became effective 11/1/2009, which covers “financial institutions,” defined typically banks and not advisers, and “creditors.” Current interpretations would include investment advisers which charge advisory fees in arrears as creditors under the rule. The FACT Act / Red Flags Rule requires covered entities to develop and maintain written identity theft prevention programs.
New SEC Regulation S-AM, effective 9/10/2009, with a compliance date of 1/1/2010, requires SEC investment advisers, and other SEC regulated entities, to the extent relevant, to implement limitations on the firm’s use of certain consumer information received from an affiliated entity to solicit that consumer for marketing purposes. Regulation S-AM provides for notice and opt-out procedures, among other things.
William Banker is responsible for reviewing, maintaining and enforcing these policies and procedures to ensure meeting Banker Investment Group's client privacy goals and objectives while at a minimum ensuring compliance with applicable federal and state laws and regulations. William Banker is also responsible for distributing these policies and procedures to employees and conducting appropriate employee training to ensure employee adherence to these policies and procedures.
Banker Investment Group has adopted various procedures to implement the firm's policy and reviews to monitor and ensure the firm's policy is observed, implemented properly and amended or updated, as appropriate, which include the following:
Non-Disclosure of Client Information
Banker Investment Group maintains safeguards to comply with federal and state standards to guard each client's nonpublic personal information. Banker Investment Group does not share any nonpublic personal information with any nonaffiliated third parties, except in the following circumstances:
- As necessary to provide the service that the client has requested or authorized, or to maintain and service the client's account
- As required by regulatory authorities or law enforcement officials who have jurisdiction over Banker Investment Group, or as otherwise required by any applicable law
- To the extent reasonably necessary to prevent fraud and unauthorized transactions.
Employees are prohibited, either during or after termination of their employment, from disclosing nonpublic personal information to any person or entity outside Banker Investment Group, including family members, except under the circumstances described above. An employee is permitted to disclose nonpublic personal information only to such other employees who need to have access to such information to deliver our services to the client.
Safeguarding and Disposal of Client Information
Banker Investment Group restricts access to nonpublic personal information to those employees who need to know such information to provide services to our clients.
Any employee who is authorized to have access to nonpublic personal information is required to keep such information in a secure compartments or receptacle on a daily basis as of the close of business each day. All electronic or computer files containing such information shall be password secured and firewall protected from access by unauthorized persons. Any conversations involving non public personal information, if appropriate at all, must be conducted by employees in private, and care must be taken to avoid any unauthorized persons overhearing or intercepting such conversations.
Safeguarding standards encompass all aspects of the Banker Investment Group that affect security. This includes not just computer security standards but also such areas as physical security and personnel procedures. Examples of important safeguarding standards that Banker Investment Group may adopt include:
- Access controls on customer information systems, including controls to authenticate and permit access only to authorized individuals and controls to prevent employees from providing customer information to unauthorized individuals who may seek to obtain this information through fraudulent means (e.g. requiring employee use of user ID numbers and passwords, etc.)
- Access restrictions at physical locations containing customer information, such as buildings, computer facilities, and records storage facilities to permit access only to authorized individuals (e.g. intruder detection devices, use of fire and burglar resistant storage devices)
- Encryption of electronic customer information, including while in transit or in storage on networks or systems to which unauthorized individuals may have access
- Procedures designed to ensure that customer information system modifications are consistent with the firm's information security program (e.g. independent approval and periodic audits of system modifications)
- Dual control procedures, segregation of duties, and employee background checks for employees with responsibilities for or access to customer information (e.g. require data entry to be reviewed for accuracy by personnel not involved in its preparation; adjustments and correction of master records should be reviewed and approved by personnel other than those approving routine transactions, etc.)
- Monitoring systems and procedures to detect actual and attempted attacks on or intrusions into customer information systems (e.g. data should be auditable for detection of loss and accidental and intentional manipulation)
- Response programs that specify actions to be taken when the firm suspects or detects that unauthorized individuals have gained access to customer information systems, including appropriate reports to regulatory and law enforcement agencies
- Measures to protect against destruction, loss, or damage of customer information due to potential environmental hazards, such as fire and water damage or technological failures (e.g. use of fire resistant storage facilities and vaults; backup and store off site key data to ensure proper recovery)
- Information systems security should incorporate system audits and monitoring, security of physical facilities and personnel, the use of commercial or in-house services (such as networking services), and contingency planning.
Any employee who is authorized to possess "consumer report information" for a business purpose is required to take reasonable measures to protect against unauthorized access to or use of the information in connection with its disposal. There are several components to establishing 'reasonable' measures that are appropriate for the firm:
- Assessing the sensitivity of the consumer report information we collect
- The nature of our advisory services and the size of our operation
- Evaluating the costs and benefits of different disposal methods
- Researching relevant technological changes and capabilities
Some methods of disposal to ensure that the information cannot practicably be read or reconstructed that Banker Investment Group may adopt include:
- Procedures requiring the burning, pulverizing, or shredding or papers containing consumer report information
- Procedures to ensure the destruction or erasure of electronic media; and
- After due diligence, contracting with a service provider engaged in the business of record destruction, to provide such services in a manner consistent with the disposal rule
Banker Investment Group will provide each natural person client with initial notice of the firm's current policy when the client relationship is established. Banker Investment Group shall also provide each such client with a new notice of the firm’s current privacy policies at least annually. If Banker Investment Group shares nonpublic personal information relating to a non-California consumer with a nonaffiliated company under circumstances not covered by an exception under Regulation S-P, the firm will deliver to each affected consumer an opportunity to opt out of such information sharing. If Banker Investment Group shares nonpublic personal information relating to a California consumer with a non affiliated company under circumstances not covered by an exception under SB1, the firm will deliver to each affected consumer an opportunity to opt in regarding such information sharing. If, at any time, Banker Investment Group adopts material changes to its privacy policies, the firm shall provide each such client with a revised notice reflecting the new privacy policies. The Compliance Officer is responsible for ensuring that required notices are distributed to the Banker Investment Group's consumers and customers.