It now takes half a year to get authorised: FCA

It now takes half a year to get authorised: FCA

The Financial Conduct Authority has promised to eliminate an authorisation backlog by the end of the year, as advisers are being left “in a state of limbo”.

The average processing times for authorising retail firms have been increasing over the past year and, as of the end of March, was at nearly 25 weeks.

But the maximum processing time in the first quarter of 2016 was 50 weeks – almost a year – though this has been going down, according to the regulator.

Article continues after advert

Phil Young, managing director of Threesixty Services, said the amount of time it can take an adviser to make changes to their authorisation status is one of the company’s “main problems”, as it recruits advisers from networks who must become directly authorised.

“I understand the FCA has brought more staff into that department but I have not seen an improvement in the speed of the process,” he stated.

“It is ironic that they have spent time on things like the Financial Advice Market Review, but at the same time there are advisers out there who cannot go out and advise because they are in a state of limbo waiting for their authorisations to come through.

“Our anticipation is that anybody we are talking to at the moment will not be authorised until next year.”

Mr Young said the delay appears to be caused by delays in the appointing of a case officer to look at an application.

Once a case officer is appointed, he said applications tend to be resolved fairly quickly.

A spokesman for the FCA said the increased amount of time it takes to handle an application for a retail firm is because of the increased complexity of cases it is currently assessing, along with the large volume of cases it is working through at the moment.

The regulator said it expected things to get worse before they got better, as over the next two quarters it trains staff it has recruited to deal with the high volume of case load.

A spokesman for the FCA said: “We are currently assigning these types of cases between eight and 10 weeks after receipt – a significant improvement when compared to six months ago.

“The time taken to assign cases to case officers should continue to improve as we reduce our backlog over the rest of 2016. To improve the backlog we are now assigning cases to case officers several weeks faster than six months ago.”

She added that appointed representative to full authorisation cases are, on average, determined two weeks after being assigned, depending on quality of application and complexity of business model.