OK, So Why Should I Need A Compliance Manual?
For any Compliance Officer, Compliance Manager or CF10 who has been in the UK financial services industry for any more than a year, they will know that one of the first documents that they have to read and attest to having done so, is the Company Compliance Manual.
Although this is not a regulatory requirement, it is a regulatory expectation as there are a range of elements that the regulatory authorities not only expect to be documented, but also somewhere that explains the reasoning behind the way that company’s manage their threats. This would clearly be best summarised in a regulatory Operational or Compliance Manual.
The Regulator expects a firm to have a personalised and firm-specific compliance or operational manual pertinent to the firm and embedded within its procedures and culture.
Most on-line and centrally maintained manuals offered by some consultants are considered NOT to be personalised, firm specific OR relevant enough to the individual firm.
As bought by IFAs, Private Banks, GI Brokers, Payment Providers, Portfolio and Asset Managers and others!
An additional function is where the firm can articulate how they expect the advisers to operate and the standards that they are expected to adhere to.
But what do I put in it?
Often Compliance Manuals may be used to document the sales process for adviser’s to observe including, for example, transaction only clients (there is no execution only anymore unless it is a self-trade) or insistent clients, and clear distinction for certain procedures and, such as when to assess a client for appropriateness (COBS 10) when they decide not to give satisfactory details for suitability to be established.
Although we do not recommend you fill your Compliance Manual with all policies and processes it is a worthwhile place to store certain policies like the Data Protection Act 2018, Anti-Bribery & Corruption Act, Outsourcing Policy and Whistleblowing protocols in addition to mentioning other documents that are very likely to need frequent updating like the Anti-Money Laundering and Counter Terrorist Financing as well as areas including your FCA Approved Persons Policy (soon to be changing to the Senior Manager & Certification Regime – SMCR) and possibly additional changes from Euroland after Brexit in 2019.
Who Made This Manual?
Lee Werrell is a Chartered Fellow of the Chartered Institute of Securities and Investments (Chartered FCSI) which is a QCF Level 6 qualification, and he has created the document for all to use from his extensive experience across many of the financial services companies he has been involved with. Lee has drawn together the manual from translating the regulators criteria and experience from establishing new banks, advising stockbrokers and fund managers together with wealth managers and IFAs, CCA firms, payment services providers and other financial institutions. Lee has over 30 years experience in UK financial services and FCA compliance.
What Content is Valid?
The substance of your Template Compliance Manual ought to be specific and accurate together with reader friendly. We do not update the manual and dictate to you what you should update (as it may not necessarily apply accurately or be pertinent to your business model) and consequently we do not charge update fees. We do not sit down and write your manual from scratch (an exercise that is very expensive in both cost to you and management time).
Once purchased, the Compliance Manual is yours to updated and amended as you see fit, updating and amending what you need to on issues and areas that you feel are important.
We do not feel that keeping your manual updated year on year is beneficial to you as the FCA and PRA consider that The key to an effective the Compliance Manual is that it must be bespoke to the firm.
And don’t forget, our Template Compliance Manual is so flexible that has been bought by IFAs, Private Banks, GI Brokers, Payment Providers, Portfolio and Asset Managers, stockbrokers (execution only and advisory), some foreign company’s with UK interests but mainly domestic small to medium sized firms, including IFA Networks and local council lending initiatives!
Check out the Video for the simplicity and logical layout of the manual and see the headings we list.
The contents that are covered in the Compliance Manual covered (alphabetically) are: (new sections are italicised)
- Advertising for New Business
- Anti-Money Laundering
- Breaches, Discipline & Enforcement
- Bribery, Facilitation and Unethical Payments
- Business Continuity
- Client classification
- Company introduction and areas of business
- Company’s compliance structure
- Complaints handling & procedure
- Complaints Sample Logs (General, 3 Day & RFCs)
- Compliance Monitoring
- Conduct Risk implications
- Conflicts of Interest
- Controlled Functions and Governance
- Customer Assets
- Data Protection
- Data Protection & Employees Rights
- Dealing with Customers
- Document Retention Policy
- FCA Approved Persons/Senior Manager & Certification Regime (from 2019)
- FCA/PRA Principles for Business
- Financial Promotions
- High Level Regulatory Requirements
- Inducements/Gifts and Entertaining
- Introduction and responsibilities of staff
- Market Abuse & Insider Dealing
- Notifications to the FCA/PRA
- Order Execution Procedure
- Principles & Code of Practice for Approved Persons
- Record Keeping
- Regulatory environment and Scope of permissions overview
- Risk assessment
- Senior Management Systems and Controls
- Senior Staff/Management listing
- Specific Permissions for company
- Stewardship Code
- Terms of Business
- Trade Monitoring Procedure
- Training & Competence
- Transaction Reporting Requirements
- Treating Customers Fairly (TCF) – Application
- Treating Customers Fairly (TCF) – Overview
- Version Control log
- Plus an extra section with ACTIVE hyperlinks (see below) to current rules and legislation, categorised for ease of your reference
Our Template Compliance Manual has nearly 130 pages of areas that are best concisely illustrated or stated here in this central reference point in a practical and cumulative layout. We use plain English and reference the rules where needed. This allows whole policies, or, if more suitable, high level documentation to be used by new personnel as a learning tool, existing staff can use it as a reference and everyone can refer to it as a regulatory guideline and company standards. This provides an exceptional interpretation of the FCA Handbook in an easy to use and clear document.
The Active links in the Bibliography take you to sections of the regulator’s handbooks and other relevant reference material, and as these documents are not written into the manual as hard copy, whenever they are updated by the regulator, you always access the latest material. The sections covered are;
Compliance Oversight and the Compliance Function,
Conduct of Business,
Sourcebook and Client Assets,
Regulatory Approach to Risk Management,
Compliance and Ethics,
Anti-Money Laundering &