Regulation 

Advisers raise concerns over FCA review deadlines

Advisers have claimed that the Financial Conduct Authority’s latest fact-finding initiative does not allow them enough time to submit information to the regulator’s flagship compliance programme.

The watchdog’s regulatory reviews for small firms follow workshops on risk awareness, and are designed to measure effectiveness across a firm of senior management, how they identify and address risks, and what controls they have in place to manage the risks.

The reviews also look at the financial soundness of firms and their ability to continue to provide products and services to customers. The reviews are based on either a face-to-face interview, a telephone interview, or an online or paper-based assessment.

However, some advisers have expressed concerns that the deadlines given to complete the online-based reviews have proved too onerous.

Simon Crawley, IFA for Surrey-based Life Stages, said his company had been given just four working days to complete the review.

Speaking on adviser forum Life Talk, Mr Crawley said the form took about two hours to complete, while the FCA was adamant he had to adhere to the allotted time, despite the email link to the online form originally being sent to the wrong person.

Meanwhile, Simon Honey, IFA for Oxfordshire-based Kingfisher Financial Management, said the review had given him such short notice that he was away, with no access to a computer, and was waiting to see whether the regulator would extend his deadline.

Many had approached the Association of Professional Financial Advisers for help, according to its recently appointed director general Chris Hannant.

He said: “We understand that about 2000 firms received this, and the initial form is part of the FCA’s investigation into financial incentives for performance. Some advisers came to us and raised concerns about the timings.

“I would say seven days is quite tight and would be awkward for some firms and the regulator might have given them a little more time. But speaking with the FCA, it does seem better to send out a short screening questionnaire like this to several thousand firms, rather than send them a lengthy one whereby advisers do not have to fill in 80 per cent of the boxes.”

On the FCA’s fact-finding initiative, Mr Hannant said: “There is not much we can say about the actual nature of the FCA’s exercise, as the detail will be fleshed out later on by the regulator, but the feeling is that the FCA’s approved persons regime will become more intrusive, certainly as far as the banks are concerned.

An FCA spokesman said: “If people have concerns or problems in completing the assessment they should contact the FCA.”

Industry View

Derek Bradley, chief executive of advisory portal Panacea Adviser, said: “The collection of data goes on and the demands on firms seem to demonstrate that the FCA expects them to have systems in place to answer all calls for information at a press of a key.

“The bigger question that should be asked is: what happens to all this data and what purpose does its provision to the FCA fulfil?

“The FCA should refer to the regulators code, which claims regulators should consider the impact that their interventions may have on small firms.”

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