Retail firms including wealth managers and mortgage and insurance intermediaries continue to face ongoing challenges with regulation. This is combined with handling a paradigm shift in consumer behaviour and the explosive growth of new technologies such as Robo Advice.
The increased focus on suitability from the FCA stems from Principle 9 – the requirement to ensure reasonable care in the suitability of advice provided to clients. The failure of firms to adequately comply with this principle is well-known and the inability of some firms to rectify and learn from industry wide past mistakes can cause financial detriment to consumers, as well as reputational damage to the firm and wider retail financial services industry.
Therefore, suitability of financial advice continues to be a growing priority for the FCA as advice is fundamental to providing consumers with appropriate products and/or portfolios that meet their needs, objectives and attitudes to risk.
How Duff & Phelps Can Help
Duff & Phelps’ experienced team comprises professionals with regulator, compliance, audit, operations and Financial Ombudsman Service (‘FOS’) backgrounds who are able to provide a range of support from a review of your suitability arrangements, training, controls and procedures to conducting bespoke reviews on past business activities. We have worked with a number of firms of different sizes and complexities, including secondments within operational teams.
Whether our review focuses on a particular area of concern or is all-encompassing of the suitability process, we take a detailed approach to assessing your compliance with the suitability requirements.
- Past Business Review: Conducting a review or a shadow review of compliance with suitability during a specific period, type(s) of clients, or product range through conducting file reviews
- Thematic Suitability Review: Conducting a file review of current and ongoing cases regarding compliance with suitability requirements, identifying potential issues, gaps and root causes and recommending changes and improvements
- Remediation and Redress: Assessing and remediating any suitability compliance issues as well as identifying and assisting in the calculation of fair and reasonable redress to customers
- Skilled Person: Acting as Skilled Person with respect of suitability arrangements and / or a past business review in line with Section 166 requirement notices or supporting a firm through the section 166 process
- Post-Remedial Reviews: Reviewing the firm’s response and remediation to identified failings from regulatory visits and providing an assessment to ensure compliance
- Regulatory Framework: Reviewing and/or drafting policies and procedures to ensure compliance with regulations
- Compliance Monitoring: Designing, implementing and/or reviewing your compliance monitoring arrangements including undertaking an assessment of your regulatory footprint and putting in place a Compliance Risk Assessment (‘CRA’) to reflect appropriate regulations, risks, gaps and mitigants.
- Complaints Handling: Undertaking a review of the firm’s complaints handling process related to potential suitability failings including the review of a sample of complaints.
- Training: Providing customized training to senior management and staff to highlight their responsibility with regards to compliance with regulations
- Governance: Assessing, reviewing and/or drafting governance frameworks including management information templates to committees and wider senior management
- Change management: Designing, managing and implementing change programs including the firm’s approach to regulatory compliance
- Ongoing Compliance Support: Providing ad-hoc compliance support as required to the firm on a wide range of topics and themes, including suitability