Financial Conduct Authority  

FCA delays SMCR in wake of virus crisis

FCA delays SMCR in wake of virus crisis

Certification requirements under the Senior Managers and Certification Regime have been delayed by four months.

It comes as the Financial Conduct Authority moves to alleviate pressure from those firms "significantly affected" by the coronavirus pandemic.

In an update on its website the City watchdog confirmed the deadline for solo-regulated firms to have completed its first "fitness and propriety" assessment of certified persons had been delayed until March 31, 2021. 

Under the original rules, which came into force across the advice industry in December last year, the certification element was set to take effect on December 9, 2020. 

The SMCR requires firms to certify that non-senior managers who can have a significant impact on customers are suitable to do their jobs on at least an annual basis.

The FCA said the decision to delay the implementation of the rule had been agreed with HM Treasury and the regulator was in the process of consulting to extend the deadlines of more requirements under the SMCR, to "ensure they remain consistent". 

Under the watchdog's proposals, the date the conduct rules come into force under SMCR, the deadline for information to the FCA register and the date by which relevant employees must have received training under the regime would also be extended from December 9 to March next year. 

The FCA said it was working to finalise its policy "as soon as possible". 

The regulator said: "Firms should continue with their programmes of work in these areas and, if they are able to certify staff earlier than March 2021, they should do so.

"Firms should not wait to remove staff who are not fit and proper from certified roles." 

The FCA said it still intends to publish details of certified employees on its financial services register starting from December 9, 2020, and encouraged firms which were able to provide information before this date to do so.  

The SMCR was introduced to banks in 2016, but was rolled out to the wider financial services industry last December in the hope it would  strengthen market integrity by making individuals more accountable.

Under the latest regime, senior individuals performing key roles will need FCA approval before starting work and they will receive a 'statement of responsibilities' that clearly says what they are responsible and accountable for.

rachel.mortimer@ft.com 

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