July 17, 2017
Business Continuity Plan
Business continuity planning is the process which defines the procedures employed during and after a significant business disruption, to ensure the timely and orderly resumption of a company’s business. Investacorp Advisory Services, Inc. (“IAS”) has therefore developed this Business Continuity Plan (“BCP”). Although it is impossible to anticipate every type of disaster scenario, we believe that our plan will enable us to continue business upon the occurrence of those events that are most likely to affect our business operations.
I. Emergency Contact Persons
Our firm’s three emergency contact persons are:
Marcus Arneaud, Chief Compliance Officer, IAS, (305) 557-3000, firstname.lastname@example.org ,
Asela Mantecon, Chief Financial Officer, IAS, (305) 557-3000, email@example.com and
Patrick Farrell, President, (305) 557-3000, firstname.lastname@example.org.
These names and e-mail addresses will be updated in the event of a material change, and our Executive Representative will review them within 17 business days of the end of each quarter.
II. Firm Policy
Our firm’s policy is to respond to a Significant Business Disruption (SBD) by helping to safeguard employees’ lives and firm property, making a financial and operational assessment, quickly recovering and resuming operations, protecting all of the firm’s books and records, and allowing our customers to transact business. In the event that we determine we are unable to continue our business, we will help assure that customers have prompt access to their funds and securities.
A. Significant Business Disruptions (SBDs)
Our plan anticipates two kinds of SBDs, internal and external. Internal SBDs affect only our firm’s ability to communicate and do business, such as a fire in our building. External SBDs prevent the operation of the securities markets or a number of firms, such as from a terrorist attack, a city flood, or a wide-scale, regional disruption. Our response to an external SBD relies more heavily on other organizations and systems, especially on the capabilities of our clearing firm.
B. Approval and Execution Authority
Asela Mantecon, acting as a registered principal, is responsible for conducting the required annual review. Asela Mantecon, Chief Financial Officer, has the authority as the Executive Representative to approve and execute this BCP.
C. Plan Location and Access
Our firm will maintain copies of its BCP plan and the annual reviews, and the changes that have been made to it for inspection. An electronic copy of our plan is located at http://www.investacorpemergency.com.
III. Business Description
Our firm conducts business as a Registered Investment Advisor in conjunction with our affiliated company, Investacorp, Inc., which transacts equity, fixed income, and derivative securities as an introducing broker/dealer. Neither IAS nor Investacorp, Inc. performs any type of clearing functions for itself or others. Furthermore, we do not hold customer funds or securities. We accept and enter orders. All trading transactions are sent to our clearing firm, which executes our orders, compares them, allocates them, clears and settles them. Our clearing firm also maintains our customers’ accounts, can grant customers access to them, and deliver funds and securities. Our firm services retail and institutional customers.
Our clearing firm is National Financial Services LLC (“NFS”) and our contact for NFS Client Management (800) 877-2410.
IV. Office Location
Our Office is located at 4400 Biscayne Blvd., 11th Floor, Miami, FL 33137. The main telephone number is (305) 557-3000. Our employees travel most often to that office by means of car. We engage in order taking, entry, data processing, and other support services at this location.
V. Alternative Physical Location(s) of Employees
IAS’s alternative physical location is:
5155 Peachtree Parkway
Norcross, GA 30092
VI. Customers’ Access to Funds and Securities
Our firm does not maintain custody of customers’ funds nor securities, which are maintained at our clearing firm, National Financial Services LLC. In the event of an internal or external SBD, if telephone service is available, our affiliated registered persons will take customer orders or instructions and contact our clearing firm on their behalf, and if our Web access is available, our firm will post on our Web site that customers may directly access their funds and securities by contacting the clearing firm carrying their accounts. The firm will make this information available to customers through its disclosure policy.
VII. Data Back-Up and Recovery (Hard Copy and Electronic)
Our firm maintains its primary hard copy books and records and its electronic records at 4400 Biscayne Blvd, 11th Floor, Miami, FL 33137. Asela Mantecon is responsible for the maintenance of the Net Capital/accounting books and records, while Marcus Arneaud is responsible for compliance books and records. Rana Chander is responsible for supervising the back-up and recovery of our firm’s electronic data. Our firm maintains the following document types and forms that are not transmitted to our clearing firm: various account documentation (copies held by Investment Advisory Representatives at remote locations), employment records, and documentation.
The firm backs up its electronic records nightly by using an off-site location at Peak 10, Inc., 2775 Northwoods Parkway, Norcross, GA, 30071-1533. Data gets transferred to off-site location by using Virtual Private Network (VPN) tunnel. Monthly back-up drives are stored at SunTrust Bank, 15101 NW 67th Ave, Miami Lakes, FL 33014, in a safe deposit box. Month-end backup drives are retained for a period of time of 1 year, year-end backup drives are kept for 7 years.
VIII. Financial and Operational Assessments
A. Operational Risk
In the event of an SBD, we will immediately identify what means will permit us to communicate with our customers, employees, critical business constituents, critical banks, critical counter-parties, and regulators. Although the effects of an SBD will determine the means of alternative communication, the communication options we may employ will include our web site, telephone (land-based and cellular), e-mail, and fax. In addition, we will retrieve our key activity records as described in the section above, Data Back-Up and Recovery (Hard Copy and Electronic).
B. Financial and Credit Risk
In the event of an SBD, we will determine the value and liquidity of our investments and other assets to evaluate our ability to continue to fund our operations. We will contact our clearing firm to apprise them of our financial status. If we determine that we may be unable to meet our obligations to those counter-parties or otherwise continue to fund our operations, we will request additional financing from our bank or other credit sources to fulfill our obligations to our customers and clients. If we cannot remedy a capital deficiency, we will file appropriate notices with our regulators and immediately take appropriate steps.
IX. Mission Critical Systems
Our firm’s “mission critical systems” are those that ensure prompt and accurate processing of securities transactions, including order taking, entry, the maintenance of customer accounts, access to customer accounts, and the delivery of funds and securities. More specifically, in the event of an SBD these systems include allowing our Investment Advisory Representatives to enter orders from their remote locations on behalf of their clients through electronic systems and/or telephonically with either our main office or directly with our clearing firm.
We have primary responsibility for establishing and maintaining our business relationships with our customers and have sole responsibility for our mission critical functions of order taking and entry. Our clearing firm provides, through contract, the execution, comparison, allocation, clearance and settlement of securities transactions, the maintenance of customer accounts, access to customer accounts, and the delivery and custody of client funds and securities.
Our clearing firm represents that it will maintain a business continuity plan and the capacity to execute that plan. Our clearing firm represents that it will advise us of any material changes to its plans that might affect our ability to maintain our business and have presented us with an executive summary of its plans. In the event our clearing firm executes its plans, it represents that it will notify us of such execution and provides us equal access to services as its other customers. If we reasonably determine that our clearing firm has not or cannot put their plans in place quickly enough to meet our needs, or are otherwise unable to provide access to such services, our clearing firm represents that it will assist us in seeking services from alternative sources.
Our clearing firm represents that it backs-up our records at a remote site. Our clearing firm also represents that it operates a back-up operating facility in a geographically separate area with the capability to conduct the same volume of business as at its primary site. Our clearing firm has also confirmed the effectiveness of its back-up arrangements to recover from a wide scale disruption by testing, and has confirmed this through tests of its back-up arrangements.
Recovery-time objectives provide concrete goals to plan for and test against. They are not, however, hard and fast deadlines that must be met in every emergency situation, and various external factors surrounding a disruption, such as time of day, scope of disruption, and status of critical infrastructure—particularly telecommunications—can affect actual recovery times. Recovery refers to the restoration of clearing and settlement activities after a wide-scale disruption; resumption refers to the capacity to accept and process new transactions and payments after a wide-scale disruption.
Our clearing firm backs-up a variety of our important records in an area geographically separate from IAS’s home office in South Florida. While every emergency situation poses unique problems based on external factors, such as time of day and the severity of the disruption, we have been advised by our clearing firm that its objective is to restore its own operations and be able to complete existing transactions and accept new transactions and payments within 24 hours. Trade orders and requests for funds and securities could be delayed during this period.
Significant business disruptions can vary in their scope, such as one effecting only our firm; one effecting a single building housing our firm; one effecting the business district where our firm is located, the city where we are located, or the whole region. Within each of these areas, the severity of the disruption can also vary from minimal to severe. In a disruption to only our firm or a building housing our firm, we will transfer our operations to a local site when needed and expect to recover and resume business within 48 hours. In a disruption affecting our business district, city, or region, we will transfer our operations to a site outside of the affected area, and recover and resume business within five days. In either situation, we plan to continue in business, transfer operations to our clearing firm if necessary, and notify clients through our Investment Advisory Representatives, or our web site www.investacorp.comwww.investacorp.com or our customer emergency number at (305) 364-8905, on how to contact us. If the significant business disruption is so severe that it prevents us from remaining in business, we will assure our customers prompt access to their funds and securities.
A. Our Firm’s Mission Critical Systems
1. Order Taking
Currently, our firm receives orders from customers via telephone or in-person visits by the customer to our Investment Advisory Representatives. During an SBD, either internal or external, we will continue to take orders through any of these methods that are available and reliable, and in addition, as communications permit, we will inform our customers of what alternatives they have to send their orders to us. Investment Advisory Representatives may also inform customers of available alternatives. If necessary, we will advise our customers to place orders directly with our clearing firm.
2. Order Entry
Currently, our firm enters orders by recording them on paper and electronically and sending them to our clearing firm electronically or telephonically.
3. Order Execution
We currently execute orders by either: (1) Telephonic Method where by our Investment Advisory Representatives place transactions via telephone into Investacorp’s Order Desk. Written trade tickets and blotters are created by our order desk staff and the information on those tickets or blotters are then entered into the clearing firm system for execution. Some of the transactions may also be placed with other third market dealers or fixed income firms for execution and then re-entered into the clearing firm for billing of the confirmations to our clients, or (2) Electronic Method where our Investment Advisory Representatives place the transactions themselves into the clearing firm system for execution. That process is available via NFS’s trading system, Streetscape.
In the event of an internal SBD where our telephone systems are not operational, we would have our Investment Advisory Representatives enter their orders electronically via Streetscape.
B. Mission Critical Systems Provided by Our Clearing Firm
Our firm relies, by contract, on our clearing firm to provide order execution, order comparison, order allocation, the maintenance of customer accounts, delivery of funds and securities, and access to customer accounts.
X. Alternate Communications Between the Firm and Customers, Employees, and Regulators
We now communicate with our customers using the telephone, e-mail, our website, fax, U.S. mail, and in-person visits at our firm or at the customer’s location. In the event of an SBD, we will assess which means of communication are still available to us, and use the means closest in speed and form (written or oral) to the means that we have used in the past to communicate with the other party. For example, if we have communicated with a party by e-mail but the Internet is unavailable, we will call the party on the telephone and follow up where a record is needed with paper copy in the U.S. mail.
We now communicate with our employees using the telephone, e-mail, and in-person. In the event of an SBD, we will assess which means of communication are still available to us, and use the means closest in speed and form (written or oral) to the means that we have used in the past to communicate with the other party. We will also employ a call tree so that senior management can reach all employees quickly during an SBD. The call tree includes all staff home and office telephone numbers and their email addresses. We have also identified persons, noted below, who live near each other and may reach each other in person:
The person to invoke use of the call tree is: Asela Mantecon, (305) 557-3000 (Office), email@example.com
Caller Call Recipient
Rana Chander MIS Personnel
Joe Verga Trading, Cashiering, Account Services personnel
Marcus Arneaud Compliance personnel
Asela Mantecon Chief Financial Officer / Accounting, Commissions and all other company personnel
We communicate with our regulators using the telephone, e-mail, fax, U.S. mail, and in-person. In the event of an SBD, we will assess which means of communications are still available to us, and use the means closest in speed and form (written or oral) to the means that we have used in the past to communicate with the other party.
XI. Critical Business Constituents, Banks, and Counter-Parties
A. Business constituents
We have contacted our critical business constituents (businesses with which we have an ongoing commercial relationship in support of our operating activities, such as vendors providing us critical services), and determined the extent to which we can continue our business relationship with them in light of an internal or external SBD. We will quickly establish alternative arrangements if a business constituent can no longer provide the needed goods or services when needed of them because of a SBD to them or our firm.
We have contacted our banks and lenders to determine if they can continue to provide the services that we will need in light of an internal or external SBD. The bank maintaining our operating account is SunTrust Bank at 777 Brickell Ave, 2nd Floors, Miami, FL 33131 and phone number (305) 577-5179, facsimile (305) 377-4132 and our contact person is Alex Albelo at telephone number (305) 577-5179.
We have contacted our critical counter-parties, such as institutional providers, to determine if we will be able to carry out our transactions with their assistance in light of an internal or external SBD. Where the transactions cannot be completed with our clearing firm, we will contact those counter-parties directly to make alternative arrangements to complete those transactions as soon as possible.
D. Clearing Firm
We have contacted our clearing firm, to determine if we will be able to carry out our transactions with their assistance in light of an internal or external SBD. Our firm does not maintain custody of customers’ funds nor securities, which are maintained at our clearing firm, National Financial Services LLC. In the event of an internal or external SBD, if telephone service is available, our affiliated registered persons will take customer orders or instructions and contact our clearing firm on their behalf, and if our Web access is available, our firm will post on our Website that customers may directly access their funds and securities by contacting the clearing firm carrying their accounts.
XII. Regulatory Reporting
Our firm is subject to regulation by the SEC and the various states. We now file reports with our regulators using paper copies in the U.S. mail, and electronically using fax, e-mail, and the Internet. In the event of an SBD, we will check with the SEC and other regulators to determine which means of filing are still available to us, and use the means closest in speed and form (written or oral) to our previous filing method. In the event that we cannot contact our regulators, we will continue to file required reports using the communication means available to us. Our primary regulator contact information is as follows: Securities and Exchange Commission, Division of Market Regulation, 100 F Street, N. E., Washington, DC 20549, at telephone number (202) 551-5720.
XIII. Disclosure of Business Continuity Plan
We disclose in writing a summary of our BCP to customers at account opening. We also post the summary on our Web site and mail it to customers upon request. Our summary addresses the possibility of a future SBD and how we plan to respond to events of varying scope. In addressing the events of varying scope, our summary (1) provides specific scenarios of varying severity (e.g., a firm-only business disruption, a disruption to a single building, a disruption to a business district, a city-wide business disruption, and a regional disruption); (2) states whether we plan to continue business during that scenario and, if so, our planned recovery time; and (3) provides general information on our intended response. Our summary discloses the existence of any back-up facilities and arrangements. The summary statement, which we refer to as our “Business Continuity Disclosure Document,” can be found at the bottom of this BCP document.
XIV. Updates Quarterly and Annually Reviews
Our firm will update this plan whenever we have a material change to our operations, structure, business or location or to those of our clearing firm. In addition, our firm will review this BCP quarterly and annually, on or about the month of January, to modify it for any changes in our operations, structure, business, or location or those of our clearing firm.
XV. Senior Manager Approval
I have approved this Business Continuity Plan as reasonably designed to enable our firm to meet its obligations to customers in the event of an SBD.
Signed: Asela Mantecon/ Signature on file
Name: Asela Mantecon
Title: Chief Financial Officer
See Below for Supplement to the Investacorp, Inc. BCP
May 27, 2011
Business Continuity Disclosure Document
Investacorp Advisory Services, Inc. (“IAS”) has developed a Business Continuity Plan, which explains how we will respond to events that significantly disrupt our business. Since the timing and impact of disasters and disruptions is unpredictable, we will have to be flexible in responding to actual events as they occur. With that in mind, we are providing you with this disclosure information for our Business Continuity Plan.
Contacting Us – If after a significant business disruption you cannot contact your IAS Investment Advisory Representative at his/her normal business telephone number, call Investacorp directly at (305) 557-3000, or you may call our alternative emergency number at (305) 364-8905. If you cannot access us through any of those means, you should consult your trading account statement, and then contact the clearing firm at the following number listed below for instructions on how the clearing firm may provide prompt access to funds and securities, enter orders and process other trade-related, cash, and security transfer transactions.
National Financial Services, LLC
If your account is held directly by a mutual fund company, insurance carrier or other sponsor, you may contact them directly by referencing the telephone number or other instructions on your most recent account statement.
Our Business Continuity Plan – We plan to quickly recover and resume business operations after a significant business disruption and respond by safeguarding our employees and property, making a financial and operational assessment, protecting the firm’s books and records, and allowing our customers to transact business. In short, our Business Continuity Plan is designed to permit our firm to resume operations as quickly as possible, given the scope and severity of the significant business disruption.
Our Business Continuity Plan addresses: data backup and recovery; all mission critical systems; financial and operational assessments; alternative communications with customers, employees, and regulators; alternate physical location of employees; critical supplier, contractor, bank and counter-party impact; regulatory reporting; and helping to assure our customers with prompt access to their funds and securities if we are unable to continue our business.
Our clearing firm, National Financial Services, LLC, backs-up a variety of its important records in a geographically separate area. While every emergency situation poses unique problems based on external factors, such as time of day and the severity of the disruption, our clearing firm has advised us that its objective is to restore its own operations and be able to complete existing transactions and accept new transactions and payments within 24 hours. Therefore, your orders and requests for funds and securities could be delayed during this period.
Varying Disruptions – Significant business disruptions can vary in their scope, such as one effecting only our firm; one effecting a single building housing our firm; one effecting the business district where our firm is located, the city where we are located, or the whole region. Within each of these areas, the severity of the disruption can also vary from minimal to severe. In a disruption to only our firm or a building housing our firm, we will transfer our operations to a local site when needed and expect to recover and resume business within 48 hours. In a disruption affecting our business district, city, or region, we will transfer our operations to a site outside of the affected area, and anticipate recovery and resumption of business within five days. In either situation, we plan to continue in business, transfer operations to our clearing firm if necessary, and notify you through our web site (www.investacorp.com) or our customer emergency number (305) 364-8905 on how to contact us. If the significant business disruption is so severe that it prevents us from remaining in business, we will assure our customers prompt access to their funds and securities.
For more information – If you have questions about our Business Continuity Plan, you can contact us at (305) 557-3000.