TECHNICAL TALK
THE REGULATION FORECAST
Mark Greenwood Director of Compliance Services SimplyBiz
The disadvantage of writing a piece about the
regulatory outlook for the year in January , when it won ’ t be with you until the end of March , is that the FCA is nothing if not unpredictable . No matter how smooth and calm the waters appear to be at the moment , there ’ s every chance that this magazine will land on your doormat alongside such a flurry of finalised guidance and Dear CEO letters that you ’ ll feel as though you ’ re being recruited to the financial services version of Hogwarts ! Similarly , in 2020 , the arrival of COVID-19 meant that the FCA had to put quite a few big projects , including vulnerable clients and assessing suitability , on the back burner whilst it dealt with the more immediate issues raised – or increased in importance – by the pandemic and the ripples of its repercussions . Although the numbers of those vaccinated , at least partly , are rising in a very positive way at the time of writing , I think it would be foolish to suggest that nothing could happen at this stage to throw us off course and prevent the long-discussed return to ‘ normal life ’. So , with that disclaimer out of the way , what do we know – or think we know – about regulation in the first part of 2021 ? Well , it ’ ll come as no surprise to anyone that vulnerability is near the top of the regulator ’ s list of priorities . A process for working with vulnerable clients which is structured , sensitive and easy to record and report has long been a recommendation from the FCA , but , with finalised guidance delivered in late February , we now have a clearer outline of exactly what the regulator requires from you . The vast , vast majority of advisers are already observing the principles of the FCA ’ s approach to dealing with vulnerable clients ; the finalised guidance just crystalises a formal way of recording , and reporting upon , your processes . SimplyBiz , and our partners , have provided a host of information and resources that can help develop your understanding of vulnerability , approach ( sometimes difficult ) conversations with clients , and access further guidance and specialist support for vulnerable clients . You can find it all in the Vulnerability Hub on the Member or Client sites . Our online vulnerability skills training – which you can access through the Hub - delivers a high-level overview of the key issues around supporting vulnerable clients , covering both practical elements and soft skills . Provided as part of our core service , it ’ s conducted through a series of videos and should take around an hour to complete , and it is eligible for structured CPD . Requiring your staff to undertake online training around the fair treatment of vulnerable clients is an excellent way for Senior Managers to demonstrate they have taken reasonable steps to embed it into your firm ’ s policies and culture . As I mentioned above , work on Assessing Suitability Review 2 was amongst the projects delayed by the pandemic . It ’ s undoubtedly another of the FCA ’ s biggest focusses , and work was
scheduled to start again in 2021 ( although , at the time of writing , it is currently on hold , with no indication of when it may resume ), focussing on initial and ongoing advice to consumers on taking an income in retirement . Some areas to consider regarding this review are –
• Can you identify all pension decumulation advice events both initially and ongoing ?
• Do you have a standardised process for all clients ?
• How do you assess the quality of your files ? Is this done independently ?
If you receive a letter from the FCA as part of this review , I recommend that you speak with our compliance helpdesk who will be happy to talk it through with you and provide assistance throughout the process .
Support from SimplyBiz As always , there ’ s an array of material , resources and services available to support you in meeting regulatory requirements . Just a few examples are outlined below …
Regulatory Reporting and Notification Guide Brand new for 2021 , this interactive guide will assist your firm with its FCA reporting and notification requirements . In addition to outlining each requirement , it provides direct access to the correct area of the FCA ’ s site , as well as to the breadth of supporting material and guidance from SimplyBiz , at the click of a button . You can find this guide in the Operating Centre , on the website .
Compliance Visits Our Regulatory Consultancy Team can offer a wide variety of bespoke compliance solutions to support your firm in meeting its regulatory obligations . They are an experienced , highly qualified team located in all areas of the UK – although currently working virtually - able to assist you in supporting your business needs and meeting Financial Conduct Authority expectations . With a satisfaction rating of 9.8 out of 10 , our compliance visits are designed to give you peace of mind that your firm ’ s compliance arrangements and systems and controls are both compliant and in good operational order . The following can be included in an onsite visit :
• Review of key risks to business
• Update on current regulatory issues / FCA activity
• An overview of the holistic compliance health of your firm
• Review of the adherence of your firm to key FCA requirements
• Assessment of your Treating Customers Fairly procedures and strategy
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