Regulation  

FCA receives muted response to senior manager consultation

FCA receives muted response to senior manager consultation

The Financial Conduct Authority has received only 29 responses to its final consultation on the Senior Managers and Certification Regime which confirmed some positions will be excluded from approval under the rules. 

The SMCR was introduced to banks in 2016 with an aim to increase individual accountability in the sector and is being extended to the wider financial services industry on December 9, 2019. 

Earlier this year the FCA consulted on changes to "optimise" the regime and today (July 26) published its final policy statement setting out rules relevant to all firms under SMCR, including advisers and claims management companies. 

Of the 29 responses received to the final consultation the FCA said "most" were supportive of its proposals but in some instances respondents had asked for further clarification on how the new rules would apply.

Respondents were asked eight questions regarding proposed amendments to the SMCR, including whether individuals who have no scope to "choose, decide or reach a judgement" on what should be done in a given situation and whose work does not require "significant skill" should also be excluded.

In today's policy statement the regulator confirmed it would be amending the scope of the client dealing function as suggested, meaning firms now have the flexibility to exclude administrative staff from certification under the new regime. 

Points to be mooted under the consultation paper also included whether the position of head of legal should be excluded from approval under the regime, feedback on the FCA's cost benefit analysis of proposed rules and extending the requirement for senior managers to disclose certain information to the regulator to also cover limited scope firms in the UK. 

According to the regulator in a small number of cases respondents opposed its proposals or suggested changes to the rules, but the regulator implemented all eight proposals as originally consulted on. 

The City-watchdog said it had already published a discussion paper on the "most significant" elements of the incoming SMCR, which it said had generated lots of interest, and therefore it was not expecting a large number of responses to the latest points raised.

Trade bodies were amongst respondents to the final consultation, including UK Finance, the Investment Association and the Association of British Insurers, which the regulator said showed "clear evidence" of industry engagement. 

The FCA also confirmed final rules for its incoming directory, intended as a public resource for checking the details of a wider group of people working in financial services and including those certified by firms to provide financial advice.

In March 2019 the regulator published rules to introduce the directory, with the introduction of the SMCR later this year meaning only senior managers at firms will be listed in what is currently the register. 

The directory is set to be launched to the public in phases from March 2020, but in today's statement the FCA said solo-regulated firms could start submitting data on directory persons once the SMCR has been introduced on December 9.