PIMFA Weekly News Bulletin - 18 October 2021

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PIMFA WEEKLY NEWS BULLETIN | 18 October 2021 Dear Nigel,

Welcome to the PIMFA Bulletin; grab a coffee and take 10 minutes to read the latest news impacting you and your firm.

DIVERSITY & INCLUSION AWARDS | 20 OCTOBER | 4PM Register your for your ticket Last chance to book your FREE virtual ticket for the inaugural awards ceremony!

The winners will announced on 20 October and you can register to attend the virtual awards ceremony here.

Talent, Diversity and Inclusion within the Wealth Management and Advice sector

Talent, Diversity and Inclusion are a high priority for CEOs in the sector, according to CEO sentiment surveys PIMFA have conducted over the past 18 months. In order to understand the make-up, challenges and current activities of firms, we have compiled a simple survey, based on data that we believe firms may have gathered.

This questionnaire is timely given the publication of the Discussion Paper from the FCA/PRA/BoE on diversity and inclusion. Data is key to understanding the picture in the sector and any required action. We would therefore really appreciate it if HR colleagues or other individuals in the wealth management sector firms would provide a response to the survey. All information received will be aggregated and anonymised by PIMFA staff.

Individual company data will be stored securely and not shared in any way.

The data required by the questionnaire will be harder to provide for some firms, particularly smaller ones. However, even incomplete data will be useful. No matter where your organisation finds itself and how advanced your people data or diversity and inclusion initiatives are, providing responses will help obtain an accurate picture. The purpose of gathering this data is to inform initiatives we can undertake together as an industry, to promote the sector more broadly and to identify gaps where collective action can be undertaken.

The link to the survey can be found here. If you have any questions, please get in touch with Maja Erceg.

PIMFA responds to HMT’s Call for Evidence and Consultation on the Money Laundering Regulations (MLRs)

In July, HM Treasury published two documents in relation to the MLRs: •

A consultation on a statutory instrument to take forward a number of measures that either

need to be implemented quickly or are straightforward

•

A Call for Evidence on the MLRs to take a broader look at effectiveness of the regulations

and the Anti-Money Laundering (AML) supervisory regime and consider options for reform

PIMFA have responded to both publications, emphasising the need for the regulator to have a better understanding of the business models and products within the wealth management space and calling for an increased focus on a proper application of the riskbased approach, rather than tick-box compliance.

It was indicated that the MLRs must support the introduction of new technologies and, in particular, must not in any way act as a blocker to the full use of digital ID as currently being proposed by DCMS.

In relation to Suspicious Activity Reports (SARs) reporting and the role of supervisors, PIMFA emphasised that it is not the role of the supervisor to tackle the quality of SAR reporting. SARs are a law enforcement tool for the NCA and there would be little benefit in the FCA taking on this role too. It would be resource-intensive and a duplication of the work already carried out by the National Crime Agency (NCA).

You can read this and all other PIMFA consultation responses here.

The Sunday Times 'Wealth and Asset Management' Report

Raconteur will be producing their 'Wealth and Asset Management' report, coming out in The Sunday Times, on the 19th of December. Our arrangement with them means that, as a member of PIMFA, you can apply to be a commercial partner on the report for significantly discounted rates.

The report will be covering major topics ranging from ESG to technological development in the industry, setting the tone for which companies are major players this year.

Please contact Jamie Oglesby at Raconteur to learn more.

Latest PIMFA Press Releases

Latest PIMFA Press Coverage

PIMFA welcomes industry guide helping advice firms to structure their relationships with Discretionary Investment Managers

Citywire New Model Adviser: PIMFA Diversity & Inclusion Awards: The shortlists

GoSimpleTax becomes latest PIMFA Plus Partner – offering firms a tailored tax solution for clients

FT Adviser: 'Don't get suckered in': Scams

PIMFA calls for fundamental review of PRIIPs regime rather than a ‘sticking plaster’ approach

Portfolio Adviser: PIMFA unveils adviser guide

PIMFA delighted to announce shortlist for inaugural Diversity & Inclusion Awards

warning animation launches

to bolster DFM relationships

Professional Adviser: PIMFA publishes adviser/DIMs cooperation guide

PIMFA appoints Alison Moynihan as Chair of its Private Investors Indices Committee

The Daily Telegraph: Bitcoin is losing popularity – is it still worth buying?

Operational Resilience for Firms

25 November | Click here to register

This half-day PIMFA Virtual event with PwC on Operational Resilience will offer attendees great insights on topics including: •

Executive and Board engagement on operational resilience (and the self-assessment)

•

Operational resilience meets financial resilience: how ICARA fits with the operational resilience

•

Managing your third parties

•

Testing your resilience: the importance of robust scenario testing

•

Level of sophistication” how much is enough?

Click here to register

View other upcoming PIMFA Events and Learning here.

Economic Crime Levy

Following on from the Treasury’s publication of its response to the consultation on the Economic Crime Levy on the 21st September, PIMFA have responded to the technical consultation on the draft legislation, expressing its disappointment that HMT has decided to exempt from payment of the levy small firms with UK revenue below £10.2 million.

PIMFA believes that a small flat fee should be applied to small firms on the basis that revenue size isn’t necessarily an indicator of risk and that all regulated firms should have a part in tackling money laundering.

You can read the response in full here.

Chairman to Leave the FCA and PSR in Spring 2022

Charles Randell CBE, Chairman of the FCA and the Payment Systems Regulator (PSR), has asked the Chancellor to commence the process to appoint his successor. Randell was appointed Chair of the FCA and the PSR with effect from 1 April 2018 and plans to leave both organisations in Spring 2022.

In the announcement, he said: "as the FCA prepares to implement its new wholesale, retail and data strategies under an established new executive, now is the right time for a new Chair to carry on the close and continuous oversight of our transformation. Being Chair of the FCA and PSR has been a great privilege. During the pandemic, the FCA stood up for consumers and businesses, while the markets we oversee proved resilient, laying the

foundations for record capital raising to support the recovery."

Read comments from PIMFA CEO Liz Field here.

FCA: Partnerships, priorities and predictions for the future in the pensions market

Sarah Pritchard, FCA Executive Director for Markets, gave a speech on 14th October to the annual conference of the Pensions and Lifetime Savings Association on effective pensions regulation, outlining the three main areas of focus for the FCA - advice and guidance for consumers, seeing that pension products are well designed and represent value for money; and making the pensions market work well, without scams.

The full draft of the speech can be viewed here.

HM Treasury: New Capital Raising Review to Boost UK Companies and Markets

A new review to boost companies listed on UK stock markets by giving them more options when raising capital was launched on 12 October 2021. The UK Secondary Capital Raising Review will be chaired by senior Freshfields lawyer Mark Austin and will examine whether rule changes and better use of technology could make capital raising more efficient for companies already listed on UK markets.

The launch of the Review is the latest step in the Government’s response to Lord Hill’s UK Listings Review, which was set up to make the UK an even more attractive destination for IPOs and optimise the capital raising process for large and small companies. The expert group led by Mark Austin will review regulatory barriers and open up the choices for listed companies seeking to raise capital, including by looking at the overall duration of the process, considering whether new technology can be used to speed up the information flow to shareholders and help them exercise their rights, and assessing other fundraising mechanisms that are used in international markets.

The Review’s work will be carried out in consultation with relevant stakeholders including the Government and the FCA, buy-side and sell-side firms, listed companies, and legal and academic experts. A Call for Evidence will run until 16 November and will report to the Government in Spring 2022.

UK's Global Investment Summit

Global business leaders and industry heavyweights will join the Prime Minister at the UK’s Global Investment Summit later this month, the Department for International Trade has announced. The Summit will bring together investors from priority markets all around the world, with some 87% of attendees hailing from outside the UK, including 32% from the US and 11% from CPTPP nations.

The topics that will be discussed include the UK’s leading role in life sciences including the successful vaccine roll-out, levelling up and attracting greener and more sustainable investments, the UK’s expertise in generating tech unicorns, trade and investment’s role in shaping a more sustainable future for all and the role of green finance.

The Summit comes two weeks ahead of COP26 and will convene global business leaders – and crucial partners in achieving Net Zero globally – to look at green growth and highlight the significant inward investment opportunities in the UK in support of the Prime Minister’s 10 Point Plan.

The PM’s Ten Point Plan Kickstarts Green investment Boom

More than £5.8 billion of foreign investment in green projects has been secured since the launch of the Prime Minister’s Ten Point Plan, along with at least 56,000 jobs in the UK’s clean industries. This major green investment boost, revealed in new data released by the Department for International Trade, helps to drive forward the PM’s ambitions to make the UK a global leader in green technology and finance.

UK and international investment has backed the vision of a Green Industrial Revolution since the Prime Minister’s Ten Point Plan was launched, with around 56,000 green jobs

across the UK economy either already online or in the pipeline over the next decade. The PM's Plan will mobilise £12 billion of government investment over the next decade to create and support up to 250,000 highly skilled green jobs in the UK – and unlock three times as much private sector investment by 2030. The government’s Net Zero Strategy will build on its progress and set out a clear path to net zero emissions by 2050.

TheCityUK: The Budget must deliver a more competitive financial centre

TheCityUK has called on the Chancellor to use his 2021 Budget and Spending Review to reinforce UK competitiveness and help return the UK to being the world’s leading international financial centre within five years. The UK-based financial and related professional services industry shares the compelling vision set out in the Chancellor’s Mansion House speech to make “this country the world’s most exciting financial services hub for decades to come.” However, delivery of that vision requires close cooperation and a concerted effort between government, industry, and regulators.

TheCityUK has set out the industry’s recommendations for the upcoming Review, including measures on tax, supporting the judiciary and courts system, and deepening the UK’s diplomatic and regulatory leadership with key markets around the world. It also recommends partnering with the industry to help achieve key objectives to level-up the economy and deliver on the transition to Net Zero.

Remote or Hybrid Working Expectations for Firms

Due to the coronavirus pandemic, firms are already familiar with working in a remote environment and adapting their systems and controls. It is likely many firms will continue these new ways of working. Consequently, The FCA has set out its expectations so firms can plan and continue to meet their regulatory responsibilities and these expectations will evolve as more is understood about how firms intend to operate.

Firms should be able to prove that the lack of a centralised location or remote working does not or is unlikely to affect the firm’s location in the UK, or its ability to meet and

continue to meet the threshold conditions for the regulated activities it has or will have permission for; prevent the FCA receiving information about a firm; reduce the accuracy of the Financial Services Register for others if, for example, consumers are not able to contact the firm at the principal place of business shown on the FS Register; affect the ability of the firm to oversee its functions including any outsourced functions; cause detriment to consumers; damage the integrity of the market; increase the risk of financial crime or reduce competition.

PIMFA's Latest Consultation Responses

PIMFA’s latest Consultation Response is to the FCA CP 21/28 on the New Cancellation and Variation Power; Changes to the Handbook and Enforcement Guide Read this and all other PIMFA consultation papers here.

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