articles: Regulatory consulting

MiFID II countdown – five months to go

On 3 July, the FCA published policy statement PS17/14 detailing their final rules on conduct of business and client assets as part of the implementation of MiFID II in the UK. In this article we focus on the new conduct requirements and provide a brief outline on the main changes being introduced on best execution, investment research and inducements. 

Extending the Senior Managers & Certification Regime to all FCA firms – summary of Consultation Paper 17/25 on Individual Accountability

On Wednesday, the FCA issued a consultation paper (CP17/25)  on the extension of the Senior Managers & Certification Regime (‘SM&CR’) to those FSMA authorised firms that are not currently in scope of the regime.
The key drivers of this reform are still the same as the original SM&CR that is currently applicable to the banking sector; Improving culture and governance in financial services firms, holding senior managers to high standards through individual accountability and increasing consumer protection remain amongst the highest priorities for the FCA.

The future of regulation in the shadow of Brexit

With the Prime Minister Theresa May indicating that there is insufficient time to replace European bodies with a new British regulatory regime, the implications of Brexit look to have limited short term impact on Financial Services regulation. However, beyond March 2019, what would a hard or soft Brexit look like in terms of future regulation?

Should you expect more from your CASS Auditors?

With increased regulatory focus, further complexity for CASS rules, and recording-breaking fines for CASS failings, it is paramount that you have an advisor who combines technical CASS expertise with an in-depth understanding of the industry. However, last year’s introduction by the Financial Reporting Council of rigorous new CASS audit led most fees to increase considerably. But are you getting value for money?

MiFID II: common misconceptions

With only seven months to go until its implementation date, MiFID II is one of the most talked-about topics in the financial industry. However, we are still finding that a number of firms fall victim to some misinterpretations and common misconceptions about the changes brought about by MiFID II.

FCA raises market stability concerns over disorderly wind downs in the investment management sector

This year, for the first time, the FCA has published its Sector Views document alongside its Business Plan. The FCA’s view of the investment management sector identifies key areas of focus for the industry, including:
  • overpayment of some investment management services;
  • ability of custody banks to meet service standards;
  • products designed for ease of management rather than meeting investors’ needs;
  • disorderly failure or wind down of investment managers or their portfolios.
When winding down funds or investment managers, we have found that the first three issues listed above are often found together. Furthermore, typically, these issues are a result of an investment manager growing quickly while the back office processes fail to keep pace.
 

Time to tighten your anti-money laundering defences

By 26 June 2017, all European Union member states are required to have enacted the Fourth Money Laundering Directive (4MLD) into national law. 4MLD aims to give effect to the updated Financial Action Task Force (“FATF”) standards. With this in mind Firms need to make sure their policies, procedures, systems and controls are up to scratch.

How ready are you for MiFID II?

With an implementation date of 3 January 2018, the deadline for readying your firm for the required changes is rapidly approaching. However, in a recent Moore Stephens survey, it was found that only 7% of firms had started their implementation plans and more than half did not even have a plan in place yet to achieve timely compliance.
 
To aid firms in scope of MiFID II, this article highlights the key milestones you need to work towards over the coming nine months.

MiFID II authorisations gateway

The FCA announced the opening of the MIFID II authorisations gateway on 30 January. It is thought that around 600 applications will be submitted over the coming months including new applications for authorisation of organised trading facilities, commodities dealers and data reporting service providers. Similarly, variations of permissions and notifications from existing firms that require a change of permission or passporting rights are expected.

FCA Business Plan: key plans and priorities for the regulator in 2016/17

The FCA Business Plan and Risk Outlook form the cornerstone documents for regulated firms to remain ahead of the curve for regulatory change. These documents effectively signpost the major regulatory focuses for the coming year and outline the FCA’s view on key risks, its priorities, and planned activities. We have drawn out, and summarised, the key points firms should make sure they are aware of.

Issues to consider if you are providing CFDs

In a ‘Dear CEO’ letter issued this month, the FCA has expressed concerns following a review of 10 firms offering contracts for difference (CFD) products. The review identified several areas of concern that the FCA wished to highlight to firms across the industry offering CFDs and warned them to do more to ensure that customers know the risks they are taking with these products. With the ensuing regulatory focus we detail what firms should be doing over the coming weeks to ensure they address the FCA’s concerns.