Why should I consider using a compliance consultant?
We’ve found that many firms benefit from the experience we bring and our ability to focus on the impact of regulation, particularly as it changes over time. Having our assistance enables you to focus on the service you provide to your clients, safe in the knowledge that your procedures are up to date. It is not a requirement for a firm to engage an external person to provide assistance. If you do, your firm and senior management remain responsible for decisions made.
How do I choose a compliance consultant?
The Financial Conduct Authority (FCA) provides guidance on using a compliance consultant.
If you’re thinking about engaging a compliance consultant there are three key areas to consider:
identifying your needs;
agreeing the terms on which you will work together; and
acting on the recommendations given.
An independent compliance audit or regulatory risk assessment may help to identify weak areas in your current processes and practices. From this you may identify particular areas of concern and determine the level of support you require.
A key decision will be how you will monitor your business to ensure that compliance processes are being followed. You will want to know the level of experience of the consultant and how they keep up to date with regulatory and product changes. Get references and check them.
Think about how you will satisfy yourself that your consultant is providing the service you need and whether their work has helped.
From the FCA: “Make sure you consider the advice and information given to you by your consultant. You are paying for this service, so you should act where necessary to ensure you are compliant. If you have introduced new procedures, make sure all staff are aware of them, and follow them. For significant issues, you may want to check with the FCA. When reviewing compliance with our requirements, we expect firms to have acted on recommendations from consultants where appropriate.”
What services should I expect to receive?
The FCA has identified a list of common services provided by compliance consultants. It’s unlikely that you’ll need all of them, so check that potential firms provide the services you require. Here are some common services:
Initial risk assessment or audit
An initial analysis to help identify risk areas of the business and weaknesses in procedures.
Business development
Business analysis advice or advice on particular issues.
Help with setting up procedures
For example, procedural manuals and templates for key documents.
File audits
Checking that procedures are being followed, with good practices and weaknesses being identified.
Technical support
May include advice on particular products or regulatory reporting.
Training
For example needs identification, competency assessments, training solutions.
Support on individual issues
For example in dealing with a complaint, a financial promotion or a particular suitability letter.
PII cover
Help arranging cover.
Remedial work
Helping to action remedial work required by the Financial Services Authority.
Will there be an end to regulatory ‘creep’?
It certainly seems that regulation is a growth industry, both from the FCA and also from the government. We don’t foresee this slowing down. Further turbulence in markets will only reinforce the view held by politicians that more regulation is always the right answer.
By monitoring developments and providing feedback to the FCA directly and through our professional body, we can hope to influence the outcomes. We also consider the implications for our clients’ businesses, so that processes can be amended in plenty of time before change is compulsory.
To find out more, contact us by phone on +447890 311975, email info@compliancecubed.co.uk or use the below form.