Compliance Digest: 5th July 2024
It has been relatively quiet this week in the lead up to the General Election. We will see what the new Government does with the financial services industry to boost savings and investment into pensions, ISAs or GIAs, or improve the take-up of life or health protection products. Here is my latest compliance digest, summarising some of the issues that have come into my industry news feeds this week.
Please share this with your colleagues and with your network.
Training & Competence revisited
DEI in financial services: can the regulators shift the dial?
Fraudster’s £6.6m claim dismissed by Court
Training & Competence revisited
The FCA’s training and competence regime makes sure that everyone who works in financial services is appropriately qualified and well regulated. The regime comprises:
a high-level competence requirement (the 'competent employees rule') that applies to individuals engaged in the regulated activity in all UK authorised firms (including wholesale firms) as set out in the Senior Management Arrangements, Systems sourcebook (SYSC)
more detailed requirements for certain retail activities, including the need to attain a qualification where relevant, as introduced below and set out in the Training and Competence sourcebook (TC)
Individuals engaged in regulated activity include paraplanners and administrators as well as advisers. The competent employees rule states the “a firm must employ personnel with the skills, knowledge, and expertise necessary for the discharge of the responsibilities allocated to them.” This makes a wide-ranging rule that applies to everyone in your firm.
Here are some questions for you to consider:
When did you last update your Training & Competence Scheme?
Do you have a Training & Competence Scheme for your paraplanners?
Does your Training & Competence Scheme meet the evidence requirements of the Certification Scheme?
Did you review your adviser and other KPIs following the introduction of the Consumer Duty?
How do you ensure that your staff have the necessary skills and knowledge for their role?
Compliance Matters UK Limited has partnered with Skillcast (https://www.skillcast.com/) to offer a cost-effective comprehensive learning management platform for you and all your staff. In addition, we can review your Training & Competence scheme and supporting documents to ensure that it:
meets the requirements of the competent employees rule;
can evidence the competence and capability element of the certification regime; and
enable your firm to deliver good outcomes for your clients.
If you would like a comprehensive review of your Training & Competence arrangements, please contact us for a consultation.
DEI in financial services: can the regulators shift the dial?
The Law firm Womble Bond Dickenson has published an insight article about improving diversity, equity and inclusion (DEI) in UK financial services which has been on the regulatory agenda for some time. In the article, written for Compliance Monitor, Lucy Hadrill and Jo Martin from Womble Bond Dickinson review the story so far, and consider the direction of travel, assessing what this might mean for financial services firms and how firms can take a proactive approach to DEI success in the workplace.
Some firms have embraced the issue, considering the impact of non-financial misconduct when applying the Fit and Proper rules to applicants for SMF positions and the annual Certification process.
Your firm may not be classified as a large firm but should still consider the implication of diversity and inclusion as well as non-financial misconduct. Compliance Matters UK Limited can assist in assessing your firm’s systems and controls. Please contact us for a consultation.
Fraudster’s £6.6m claim dismissed by court
It has been reported that a fraudster who attempted to seek over £6.6 million in claims following a motorcycle crash has been stopped following a thorough investigation by the insurers. A report in Insurance Times confirms that following the accident in which the claimant injured all four limbs he claimed for severely reduced mobility. The investigation revealed that the claimant had been certified by his GP as fit for a tandem skydive, had undertaken a BASE jump in Italy, as well as having participated in indoor and outdoor climbing in the UK.
The Insurance Act 2015 was enacted to give clarity on fraudulent claims as defines the duty of fair presentation of risk by the policyholder.
Statistics published by the ABI indicate that in 2022, insurers detected 72,600 dishonest insurance claims valued at £1.1 billion.
According to City A.M. the UK payments industry issued an election-day plea for the next government to make tech giants liable for the reimbursement of fraud victims in a bid to alter new rules that would place the burden on the financial sector.
Trade body The Payments Association, which has more than 200 members, said in a letter addressed to the incoming Chancellor that it “strongly urged” a “tech levy” on social media firms, the funds of which could be used to compensate scam victims. We will see if comes to fruition in the coming months.
Compliance Matters UK Limited has experience of general insurance regulation, and fraud prevention measures please contact us if you would like us to review you firm’s systems and controls.
How can we help?
It is important that you have robust policies and procedures to ensure your firm delivers industry best practice and the four outcomes of the Consumer Duty. If you would like Compliance Matters UK Limited to review your compliance systems and controls, schedule a free, no-obligation consultancy call with us today.
To learn more about how Compliance Matters UK Limited can support your firm, click here.
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Ian Ashleigh
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