Just one-in-20 (5%) advisers are aware of their obligations under the FCA’s ‘PROD’ product governance rules, which were introduced alongside MiFID II in January, research by IRESS has suggested.
The study, undertaken by consultancy the lang cat on behalf of the technology solutions business, also revealed more than half of the 64 advisers polled were still unaware of PROD – the Financial Conduct Authority’s (FCA) term for its product governance and product intervention sourcebook.
Furthermore, the study found almost three-quarters (70%) of advisers to be unsure if they were able to evidence the suitability of product services by client segment, while one-third (33%) use back- office technology to help segment clients.
“The new rules in PROD have caught many people in the industry unaware,” said IRESS executive general manager (wealth) Mark Loosmore. “There seems to be widespread confusion and concern around the steps advisers should be taking to ensure client suitability processes are evidenced appropriately.
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