How confident would you be of the outcome if the FCA paid you a visit?
15th July 2016
The need for intermediaries to be confident that their processes are robust and deliver consistent outcomes has never been greater. The FCA’s steady stream of Papers (for the most part very readable despite comments from some to the contrary) is worth studying, in particular a number published since 2014:
- Finalised Guidance 14/1: Inducements and conflicts of interest
- Thematic Review 14/5: Delivering independent advice
- Thematic Review 14/6: Being clear about adviser charges and services
- Thematic Review 14/21: Post-implementation review of the Retail Distribution Review – Phase 1
- Finalised Guidance 15/1: Retail Investment Advice: Clarifying the boundaries and exploring the barriers to market development
- Consultation Paper:15/17: Capital Resources Requirements for Personal Investment Firms (PIFs)
- Policy Statement:15/19: Improving complaints handling, and feedback on CP14/30 and final rules
- Policy Statement 15/28: Capital resources for personal investment firms and feedback on CP 15/17 and final rules
- Thematic Review16/1: Assessing suitability: Research and due diligence of products and services
Firms need to ensure that their risk and compliance functions support their business activities by proactively bringing regulatory matters to the board’s attention for early review and decision and then implementing required changes efficiently and effectively with an accompanying clear audit trail. Particular attention will continue to be paid by the FCA in relation to the due diligence that advisers and firms carry out in relation to the selection of products and services to deliver compliant investment advice.
If you are concerned about your firm’s effectiveness in relation to its compliance and risk activities, assistance should be sought as the FCA has made it clear that firms will be held accountable and the number of S.166 Independent Persons Reviews which can have a debilitating effect on a firm and its activities are increasingly used by the FCA to investigate possible shortcomings.