Compliance

Capstone sets the standard for creating and adhering to a set of compliance principles that protects our clients and our business. Though we believe a system of clear rules, consistent supervision, and regular education are important elements of a good compliance plan, we do not believe these guidelines are a substitute for creating a strong culture of ethical behavior.

• Bi-annual mandatory compliance training (conducted by leading law firm K&L Gates) with a specific focus on issues related to political intelligence
• A compliance script that is read before every interaction with government employees that asks them not to reveal any confidential information
• A supervisory process that ensures that three managers sign-off that specific procedures are followed prior to each note being published, a process specifically designed to prevent MNPI from being disseminated
• Meetings and calls with government officials monitored by compliance
• Email monitoring
• Annual reviews of compliance procedures
• Regular employee attestations regarding changes to compliance procedures
• Strict procedures for the hiring and compensation of outside consultants

Capstone does not operate an expert network business model. Our core product is the analysis of our investment professionals. We do hire experts from time to time, but these interactions are strictly controlled. Capstone employees are prohibited from compensating government officials (federal, state, local, or foreign) in any way for meetings, conversations, or other interactions. Capstone employees are prohibited from compensating any person who has been a government official (federal, state, local, or foreign) within the last six months of when the payment is made. Capstone employees are prohibited from compensating any current employees of a publicly listed company or any person who has been an employee of a publicly listed company within the last 12 months of when the payment is made. Capstone employees must clear compensation for other sources (lawyers, outside experts, etc.) with the chief compliance officer.