Regulatory Compliance LLC merges with Florida consultant
LONDONDERRY — Compliance consulting company Regulatory Compliance LLC, based in Londonderry, is merging with National Compliance Services Inc., the two companies have announced.
The merger, which was made official Oct. 27, gives the combined company greater and more cost-effective capacity to serve clients, said Regulatory Compliance President and CEO Stephen Sussman.
Sussman will be co-CEO of the new company with Rita Dew, founder and CEO of NCS. He said the merger was in the works for about year, though the leaders were friends and had mentioned the idea informally in the past.
NCS is based in Delray Beach, Fla., and Regulatory Compliance has additional offices in Concord, New York and Boston. Sussman said they will maintain their current offices, but they have yet to iron out the details of their merged name and branding.
Regulatory Compliance’s 44 employees and NCS’s 36 employees will all stay with the merged company.
The two companies have offered consulting services to a variety of clients in the financial services industry, including hedge funds, registered investment advisers and broker-dealers. These clients outsource work to ensure compliance with federal regulations to Regulatory Compliance and NCS, which are now combining their operations.
Sussman said increasing pressures from the Securities and Exchange Commission and other regulators have caused problems for many financial firms, both small and large, which the consulting company tries to alleviate.
Larger consulting companies generally offer less risk to clients. They also have a better shot at attracting top talent in what can be a competitive environment.
Another perk of the merge: The joint company will combine the software capabilities of the two individual companies, providing better service to clients, Sussman said.
Combining forces was a “one plus one equals three type of idea,” he said. “We can service our clients better having more expertise across the board in both firms.”
Sussman created Regulatory Compliance in 1989, but business has really grown in the past 10 to 15 years.
“The scrutiny in the environment is much more than it’s ever been before,” he said, citing the Bernie Madoff case and Dodd-Frank legislation. “There’s just so much to know. I mean, there’s so many rules and interpretations for them to keep up with it.”
The financial services industry has moved more toward the use of Registered Investment Advisors (RIAs) and away from broker-dealers as regulation of the latter has grown, Sussman said.
The compliance consulting world has seen a few mergers recently, but more commonly a private-equity firm might acquire a consulting company, Sussman said.
The merged company has about 1,500 clients, with hundreds of billions of dollars in assets — 1,000 clients from NCS and 500 from Regulatory Compliance. They range across nearly every state and some foreign countries, though Regulatory Compliance has been more focused on the Northeast and NCS on the Southeast.