3 minute read
Upcoming Compliance Changes
Over the coming months, more changes will take place as the Network introduces our approach to the Financial Conduct Authority’s (FCA) Consumer Duty requirements. At the same time, we will also develop our approach to the updated requirements of the Appointed Representative Regulatory Regime changes, and share further details of how they will impact us all going forward.
These regulatory changes from the FCA are there to protect consumers and evidence a higher professional standard of services provided to them. It’s important to remember that primarily consumers are at the heart of everything we do, and taking a CustomerFirst mentality to business is just good practice. HLPartnership are passionate about implementing these changes to benefit consumers and ensuring that we always do the right thing. Kay Leslie
Advertisement
Compliance Director
As Compliance Director, Kay’s role at HLPartnership is integral to the Network, especially at a time when the industry faces an intense volume of regulatory change and the introduction of Consumer Duty. Kay joined HLP in 2021, bringing a wealth of skills, having held Director roles at several key industry players, and has worked in a consultative role for The Association of Mortgage Intermediaries.
A New Consumer Duty At the end of July 2022, the FCA set out the final rules and guidance for a new Consumer Duty that sets higher and clearer standards of consumer protection across financial services.
There are three behavioural standards that apply to all areas of a firm’s conduct – act in good faith towards retail customers, avoid causing foreseeable harm, and to enable & support retail customers to pursue their financial objectives.
By introducing the new Consumer Duty principle and rules, the FCA anticipates that the outcomes will be improved clarity and fairness, seeing an end to what the FCA calls ‘rip off prices’. The outcomes are principally relating to products and services, price and value of products & services, ensuring consumer understanding and providing consumer support.
What’s next for Consumer Duty? To ensure that we meet our obligations by the 31st July 2023 deadline at HLPartnership, we’ve developed an implementation plan to see where the changes will need to be, when we need to deliver the change and how we will manage the implementation. Some obvious areas for change will be:
• Disclosure
• Fact finding • Sales process and tools, customer communications
• Oversight and supervision
The Appointed Representative Regulatory Regime Review Set to be implemented from 8th December 2022, these additional requirements can be traced back to instances of mis-selling and consumer harm identified by the HM Treasury Select Committee, where it was determined that action needed to be taken to review the current regime around Appointed Representatives (AR’s).
HLPartnership are required to undertake a number of additional checks to each AR firm within the network and before appointment to the network, with enhanced oversight to monitor risks posed to consumers and markets, and checking that each firm has the capability and competency to deliver good consumer outcomes.
The rules introduce greater oversight of the other activities that the AR firm may carry on, introducing a requirement to undertake annual reviews on these third-party activities, business, and senior management to review annual fitness & competency requirements, as well as supplying complaints and all revenue information for each AR firm to the FCA.
Responding to Change Anticipating these significant regulatory updates, HLPartnership have already started to make several changes to our Compliance structures to help make the transition be as smooth as possible for HLPartnership AR firms.
We’ve increased the number of people in our Compliance Team to handle the additional requirements without risk to our standard response timings and invested in more fieldbased Regional Compliance Managers (RCM) who are there to provide help and guidance on how the changes will affect your business.
We are here to make sure we all deliver good consumer outcomes and keep everyone safe from harm, if you have any concerns or just need to chat something through, please do not hesitate to contact your local RCM.
