Category Archives: Claims management companies

Email Is Broken – UK Businesses Need To Stop Sending and Start Sharing!

Broken processes

Manual business processes are expensive to resource from a human capital perspective but also rely on person-to-person communication, which for expediency and perceived traceability is often conducted via email.

Consider typical arrangements for most people. If they forget their online banking password, they can just reset it via email. If they need to work on some confidential customer files over the weekend from home, they email it to their home account and if they want to invoice a client, they email them an invoice with their account details. All these actions are easy, simple and frequently conducted across the country, which can also make it exceptionally easy for someone else to do if they gain access to your account.
GI Brokers or Financial Advisers, Asset & Wealth Managers typically handle large numbers of emails.
They are the party in the middle, dealing with the insurer, customer, and other parties such as loss adjusters and of course, their own colleagues. Much of this communication is sensitive and might often be sent via insecure email. This proliferation of email attachments driven by lack of automation is exposing insurers, brokers and customers to  considerable and avoidable risk.
Aside from being insecure in transit, it is difficult to prove successful delivery to the recipient, the action taken by the recipient, whether they share internally or externally or how they store the potentially sensitive information.
Due to the escalating threat of email, we expect tighter controls over inbound emails with attachments to become commonplace. In the immediate aftermath of the WannaCry attack, it was reported that Aviva closed their systems to inbound emails with attachments for 4 days.

Compliance & security

With the increasing threat posed to organisations by inbound email attachments and the tightening regulatory regime and increased scrutiny in all sectors, serious thought is needed right now about replacing email attachments as the primary means of communication.

Stop sending – start sharing

If your firm is overly dependent on email attachments for customer communication, then make a management commitment to stop it, or at least reduce it over time.
For example HMRC clearly states to all taxpayers:
“HMRC will still never email you about rebates or to ask foryour bank account details and these emails won’t contain
any confidential information.”
Taxpayers are conditioned to be suspicious of sensitive emails that appear to be from HMRC as opposed to being trusting. Perhaps the Financial Services industry or individual firms could make a similar pledge?
Email attachments are not the only means of transmitting documents (usually PDFs) from one person to another. The simplest way to stop sending is to share the documents in a secure online environment, which can be securely accessed by the firm and client.

Prices from £35 PM

Stop sending – start sharing

Compliance Consultant – 0207 097 1434 or info@complianceconsultant.org

Secure Email, Secure Email Account, Secure Email Account Providers, Secure Email App, Secure Email Attachments, Secure Email Service, Secure Email Solutions

What Does A Regulatory Business Plan Need To Say?

A Regulatory Business Plan (RPB) Is Your Showcase To Demonstrate Understanding & Forethought.

The RBP should demonstrate that the targets set by the candidate are realistic, as well as financially and operationally manageable.

Some fundamental questions that the RBP must answer

Why you? The RBP could create a poor impression if it does not describe to the regulator its intended market and comparative advantage: whether it would offer something new to the market and the elements of its services/products that would make them stand out from their competitors.

Answer this – “why are you best positioned to offer and deliver on this proposition?”

You against the others: A competitive idea and promising business case is backed up with research and facts. This is a challenging part of the project; the candidate’s RBP must demonstrate that there is a market for their products and services, and also be aware of the competition and their expected share in the market.

Vitally, the RBP must also demonstrate its understanding of the dynamics of the specific market and how the proposed business will meet customer needs.

Known unknowns: Here, the question is how candidates will approach the problem of partial or unavailable information. Some RBPs are extremely ambitious about their target markets and customers; some others are optimistic as to the costs of running a business, especially operational costs and this may lead to expected costs being presented in a superficial manner in the RBP.

All projections and estimates must be backed by thorough and trustworthy market research or accurate business information.

From a regulator’s perspective, stating all the possible expenses and potential financial needs in the RBP provides a useful starting point into assessing business model viability. It also demonstrates that the applicant has a sound grasp of its figures and market.

A start-up may not have all the information to-hand on day-one when it meets the regulator, but it should have reasonable estimates and a plan of the timeline and actions to get this information and must integrate it into the plan before submitting it.

New entrants will have to describe in their plan how they will comply with complex prudential and conduct regulations. This is not easy, even the UK’s most established institutions have got themselves into significant difficulties due to regulatory breaches.

We provide all FCA Authorisation applicants with a template business plan with not only headings, but additionally pointers and ideas of what needs to be involved.

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What Is A Regulatory Business Plan? Why Is It Important?

what is regulatory business plan

All financial services firms experience the same hurdle as virtually any other new business: how to influence investors and lenders that your business has a worthwhile model, can create adequate returns and can pay back its liabilities. Candidates for FSMA Part IV Permissions face this challenge and one more; they must convince the regulators of the viability and durability of their business through their planning and preparation.

The RBP is born

A coherent and well-researched Regulatory Business Plan (RBP) is one of the most vital document on the path to reaching authorisation. In fact, many who start the process of starting a new financial services firm hardly ever get as far as formally making an application for the ‘Part 4A Permissions’ expected to start trading; the RBP is simply too weak, incoherently articulated or is not able to demonstrate a robust and viable business model.

In fact, for applicants that achieve success, the process can be arduous and painful; therefore starting with a strong RBP is essential to keeping momentum.

While there is consistently a reasonable degree of uncertainty in how the firm will work, the plan must stay away from including imprecise or unverified information. The RBP should demonstrate that the goals set by the candidate are reasonable, together with financially and operationally manageable.
Although this seems like sound judgment, reality often testifies that it is not that straightforward in practice.

Some basic questions that the RBP must answer

  • Why you? The RBP could create a poor impression if it does not describe to the regulator its proposed market and comparative advantage: whether it would offer something new to the market and the elements of its services or products that would make them be distinct from their competitors. And the reason that they are best placed to offer and deliver on this proposition?
  • Them and us: A more competitive idea and promising business case is supported with research and facts. This is a challenging part of the project, the candidate’s RBP must display that there is a market for their product or services, and also bear in mind the competition and their expected share in the marketplace. The RBP must also demonstrate its awareness of the dynamics of the market and how the proposed new firm will meet customer needs.
  • Known unknowns: Here, the concern is how candidates will approach the problem of partial or unavailable information. Some RBPs are extremely ambitious about their target audience and customers; others are optimistic concerning the costs of running a firm, especially operational risks and mitigation costs and this may lead to expected costs being presented in a superficial manner in the RBP. All projections and estimations must be backed by thorough and trustworthy market research or correct business information.

From a regulator’s perspective, mentioning all the possible expenses and prospective financial needs in the RBP provides a beneficial starting point into assessing business model viability. It also proves that the applicant has a sound grasp of its figures and market. A start-up may not have all the information to-hand on day-one when it meets the regulator, but it should have realistic estimates and a plan of the timeline and actions to obtain this information and must include it into the plan before submitting it.

New entrants will need to describe in their plan how they will abide by complex prudential and conduct regulations. This is not easy,; even the UK’s most established institutions have got themselves into significant difficulties as a result of regulatory breaches.

Many of these breaches could have been avoided if their risk and compliance measures had been proactive instead of reactive and had sufficient resources to do their job initially. Although investment in Compliance is seen as a sunk cost, the inverse is hugely costly and damaging not only financially but also from a reputational viewpoint.

Balancing optimism with pragmatism: without optimism and a belief in the business plan, the process would not even have commenced, but the RBP needs a heavy dose of pragmatism. The regulator sees a large number of implausible, ambitious, cost-heavy proposals that only could generate income if unrealistic growth plans paid off. Unrealistic plans stick out like a sore thumb

Being clear: Provide only relevant data; an overly long submission filled with generic or irrelevant data will not fulfill the RBP’s purpose to the regulator. In reality, extra detail can disorientate and make the reviewer’s job frustrating. The RBP should only present relevant information that answers the question why the particular candidate ought to be authorised.

So how can candidates maximise their chances to submit a persuasive RBP?

  • Understand the areas, topics and granularity of information that the regulator expects.
  • Ensure that the RBP meets the regulatory requirements of the FCA.
  • Be clear that several iterations of the RBP may be required to be submitted before the regulators direct you to move forward with other submissions
  • Know the sources and processes to acquire the relevant information and data to estimate and demonstrate their potential position in the market.
  • The drafting of the RBP should be conducted with clarity and precision, answering directly and precisely possible questions from the regulator.
  • Make certain that the RBP is effectively linked to all other documents (the financial plan, the ICAAP, ILAAP, risk management framework, corporate governance documents, monitoring plan etc.).
  • Listen carefully to the regulator. Remarks from the regulator will be some of the most useful advice in helping to adjust an RBP.
Compliance Consultant can arrange for a Business Plan to be created for you, but we will need your data, your Market Research, your perceived Risks and your Operational Plan (including software platform details if applicable) for us to help identify the regulatory elements that will need to be added and highlighted.

Call us on 0207 097 1434 or email businessplan@complianceconsultant.org


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Claims Management Companies (CMC) Compliance Procedures and Financial Crime Policy

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Original Post: 12th April 2019. Updated: 7th August 2019.

Claims Management Companies will need to provide to the FCA, when and if asked, Compliance Procedures and Financial Crime policies.

We have worked with a number of CMCs and have created the following for your use.

Contents

Compliance Procedures Manual – Around 92 pages

1. Introduction
2. Your responsibility
3. Regulatory environment and scope of permissions
4. Principles for Senior Managers & Certification Regime SMCR) for FCA regulated firms
5. The Company’s Compliance Structure
6. Money Laundering
7. Senior management arrangements, systems and controls
8. Conflict of Interests
9. Dealing with Customers
10. Financial Promotions
11. Customer Complaints
12. Training and Competence
13. Outsourcing
14. Notifications to FCA
15. Breach, Discipline and Enforcement
16. Compliance Monitoring
17. Data Protection
Appendix A – Complaints Logs Frameworks
Appendix B Bibliography
  • Compliance Oversight and the Compliance Function
  • Claims Management Conduct of Business Sourcebook and Client Assets
  • Regulatory Approach to Risk Management
  • Compliance and Ethics
  • Anti-Money Laundering
Appendix C GDPR Compliance Statement Template

Financial Crime Policy – Around 16 pages

1 Introduction To Financial Crime Policy
2 ANTI-BRIBERY & CORRUPTION POLICY
3 COMBATING FRAUD – INTERNAL AND EXTERNAL
Appendix 1: Register of Attendees

All this from professional compliance consultants for just £450!

 

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Claims Management Companies CMCs Compliance Procedures Manual and Financial Crime Policy

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Having worked with a number of Claims Management Companies CMCs in recent days, we are happy to provide the following service to those who have not yet put their Compliance Procedures Manual (around 100 pages) and Financial Crime Policy in place.

Contact us for details and timescales, but we will make them personalised to your firms.

Cost £225

Please complete your details below.

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Online Senior Managers & Certification Regime Compliance Course Available For Core-Limited Firms

Why This Course?

Running Your Own SMCR Preparation Project?

This course will equip you with everything you need to know and everything you need to do.

The extension of the Senior Managers and Certification Regime (SM&CR) to investment firms in December 2019 represents a major overhaul of the way in which individuals working within financial services are regulated.

The new rules increase the number of employees who are subject to regulatory obligations, whilst significantly enhancing the accountability of those in senior management positions. They also impose potentially onerous obligations on firms, from the documentation of management responsibilities to the training of employees on the application of the Conduct Rules.

We have extensive experience in training senior managers and other staff who are subject to the SM&CR and we have developed a range of training solutions to suit a wide variety of requirements. You will also gain access to a 50% discount in our special offer promotion for a valuable aid to your implementation planning.

Run by Lee Werrell Chartered Fellow of the CISI and someone with years of experience in implementing the SMCR in the banking and insurance world, you will benefit from;

  • Leveraging the trainers experience with the banking roll-out; we look to unpick the lessons to be learnt for the SMCR extension to all regulated firms
  • Packed with practical exercises to focus on the identification of key employees and what you need to do in the lead in to SMCR
  • Conduct rules; what are they, what do they mean & why do they matter?
  • Walk away with a clear plan of your next steps for your SMCR implementation
  • Includes a Special Offer on Our Popular & Practical Project Plan

The Course Objectives

  • Review and understand the history to the SMCR and where it came from
  • To know and understand the key employee categorisations within your firm, SMFs, CR, non-approved and ancillary
  • Be able to evaluate your SMFs; who are they and what they need to know
  • Analyse your CPs and define who will be in this category
  • Apply the conduct rules to your firm and your organisation
  • Review the breach process and how to apply within your firm, as well as when and why
  • Know who to train and what
  • Understand the need for accurate regulatory referencing under SMCR
  • Appreciate the need for accurate, effective and reflective governance and how you run your business.
  • Gives You A Unique DIscount Opportunity by a Special Offer on Our Popular & Practical Project Plan

In Summary

Originally rolled out to the banking sector in 2016, the Senior Managers and Certification Regime (SMCR) is about to be extended to around 47,000 additional firms.

Beginning with insurance companies, from December 2018, and reaching asset managers and other regulated firms in December 2019.

The Financial Conduct Authority (FCA) is tightening up its rules, replacing the current Approved Persons Regime with the Senior Managers and Certification Regime (SMCR). The regime has already been operating in the banking sector for some time and will this year extend to all within the financial services sector.

This change will affect all FCA regulated firms including non-UK firms with permission to carry out regulated activities in the UK, and it will focus on three key areas:

  1. The Senior Managers Regime
  2. The Certification Regime
  3. Conduct Rules

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The implementation date has been set for the 9th December 2019

Target group

  • All staff within authorised firms will be in scope

  • Senior Manager Functions (SMFs)

  • Certified Persons (CPs)

  • Non-approved

  • Also strongly recommended for those who will be directly involved in the implementation; Compliance & HR.

What you’ll learn

  • Overview & journey to the SMCR
  • FCA SMCR Key Features
  • Senior Managers Regime – Explained
  • FCA Certification Regime
  • Conduct Rules – COCON
  • And More….

Are there any course requirements or prerequisites?

  • UK FCA Registered Individual or Firm

Who this course is for:

  • UK FCA Sole Regulated Financial Services Firms
  • UK FCA Sole Regulated Financial Services Individuals
  • UK FCA Firm Compliance Directors
  • UK FCA Firm Risk Directors
  • UK FCA Firm Directors
  • UK FCA Firm Compliance Managers

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£7M bill for Claims Management Companies for FCA Authorsiation

Claims management companies (CMCs), known in the financial services compliance business as “Ambulance Chasers” will have to look for over ₤ 7m next year to put together a compliant scheme to adequately satisfy the regulator the sector, the Financial Conduct Authority (FCA) has revealed. The amount be paid in 2019-20, if accurate, is 42% of the total initial cost of adopting responsibility for the sector, which under the Financial Guidance and Claims Act 2018 devolves the authority from the Claims Management Regulator on 1 April next year. In total, the authority will recover an estimated ₤ 16.8 m from the sector by 2021, the regulator proposes.

compliants fca handbook compliance doctor management

In a consultation paper published at the end of August 2018 the FCA confirms that it is paid for entirely from the bodies it regulates; which as a result of the claims management industry’s unpredictable future it will need money up-front. When taking on new obligations, the authority can at times defer recovery of the project costs until ‘a substantial body of fee payers’ is in place. The regulator also notes; ‘However, the claims management industry is undergoing considerable change and this uncertainty limits our ability to defer recovery of costs.’

Change to the claims management landscape, notably 29 August 2019 deadline day for the submission of claims for payment protection insurance,’ could require CMCs to readjust their business models to proceed with providing claims management services for consumers, and some firms may depart the market entirely’, it notes. As a result there is a risk that project costs might fall disproportionately heavily on those firms that successfully apply for authorisation.

‘It would be unfair for firms which take advantage of the regulatory gateway, but which leave within the first year, to pass their share of the project costs to those firms which continue to be authorised by us,’ the consultation paper states. ‘For this reason, we have decided to collect a substantial proportion of our project costs in the first year.’ This will equate to an amount of ₤ 7.1 m in 2019/20, approximately 42% of the total.

The proposals are set for a rough ride from the claims management industry. Although a vast majority of the firms are likely to exit the industry in 2019, how will the FCA demonstrate that they understand the industry well enough to regulate the remaining firms effectively? Unfortunately, just as a lock only keeps out an honest man, we could end up with disproportionate costs and infrastructure changes to what amount to be successful, ethical and compliant firms.

Whenever the CMCs are set to apply for authorisation, there is plenty of help for them to engage with. Compliance Consultant are specialist FCA authorisation consultants and can assist all types of firms get the authorisation process right.

What Does FCA Authorised Mean?compliance doctor consultants london fca handbook

Based on the Financial Services and Markets Act (FSMA) 2000, financial activities are regulated by the Financial Conduct Authority (FCA). Any firm carrying out any regulated activity must be authorised by the FCA, unless they are exempt. On Approval They Are FCA Approved Persons.

FCA Authorisations are in some cases tricky and can appear very daunting to the newcomer.Compliance Consultant was created in 2000 to assist providers and individuals in their regulatory compliance requirements, here in the UK, EU and Middle East. We are also long-standing members of the Association of Professional Compliance Consultants (APCC).

Using our application experience developed from the FCA’s Authorisations Team feedback, Compliance Consultant Authorisation Services has succeeded in obtaining authorisation for a large number of clients of all sizes from a variety of fields.

Why Do They Need The Compliance Doctor?

In a speech By Sarah Rapson, Director, Authorisations on the 14th March 2018 at the APCC Conference she stated;”Sometimes firms fail to provide information we request, or they provide the wrong information, or over complicate their responses. This could be because they do not understand our concerns or the questions we ask or why we ask them. If in doubt, they should ask us.Similarly, firms can misunderstand what is required of them, especially where there is new regulation, such as PSD2 or MiFID2. Again, they should speak with us if they are uncertain as to our requirements.From time to time we deal with firms that will not engage with us or do so reluctantly; or they address our concerns in part but not fully. In such circumstances we may well conclude that a firm is not ready to be authorised and could not be supervised effectively. My message is simple; firms need to cooperate with us.Sometimes firms apply for authorisation prematurely, before they are ready to demonstrate that they meet the minimum conditions; at very least this will delay our consideration of their applications, especially if they also fail to provide the information that we require. Firms should apply when they are ready, not to secure their place in the queue.Those are just a few examples. But the common theme is that firms that understand what we are trying to achieve through having a rigorous approach to authorisations and why, are more likely to be successful in their applications.”

The FCA published a formal policy statement in December on how they will manage the CMCs, for the rules to become effective from 1 April 2019.

Lee Werrell Chartered FCSI

Compliance Doctor

compliance consultants london specialist remedial risk management fca handbook

Do I Honestly Need To Be Regulated As An FCA Authorised Person?

 

Financial services providers, investment company and retail credit firms need to be Financial Conduct Authority (FCA) authorised.

Here’s a summary of what you ought to know.

According to regulations made under the Financial Services and Markets Act (FSMA) 2000, financial activities will need to be regulated by the FCA. Any firm (whether an enterprise, a not-for-profit or a sole trader) performing a FCA regulated activities must be authorised or registered by them, unless they are exempt.

Banks, credit unions and insurance companies are regulated by the FCA and the Bank of England’s Prudential Regulation Authority (PRA).

Applications for authorisation.
You will have to apply to the FCA (or, if you’re dual-regulated, to the PRA) for FCA authorisation. This normally will take up to 6 months if sending a packaged complete application but could very well take up to One Year if your application is not complete upon submission. Your submission could be made as comprehensive as possible if we, FCA authorisation consultants, help and guide you. There is an application fee to pay directly to the FCA Authorisations department.

Appointed Representatives (ARs).
An authorised firm may assign another firm or individual to carry on regulated activities on its behalf. When this happens, the authorised firm or ‘principal’ takes full responsibility for making sure its agent or ‘appointed representative’ adheres to the FCA rules.

Responsibilities of an authorised firm.
Once you receive FCA authorisation, there’s a fee to pay annually. You’ll also must meet the FCA’s minimum standards (threshold conditions) at all times, alongside satisfying the rules and principles relevant to your business and send the regulator reports, usually through the FCA Gabriel system.

Why use FCA Authorisation Consultants?
Your firm will require FCA authorisation if it carries out an FCA regulated activities under the Financial Services and Markets Act 2000 (FSMA 2000) Regulated Activities Order (RAO).

Whether you’re seeking to broker insurance or mortgage loans, start a fintech firm, provide investment recommendations or asset management services, or operate in the Consumer Credit Act (CCA) sector your firm will have to hold FCA authorisation in order to trade unless it benefits from any of the exemptions. From APRIL 2019, Claims Management Companies will also require to become authorised by the FCA.

Obtaining FCA authorisation requires displaying to the FCA that the firm’s business model is one which meets the FCA’s requirements, that the firm’s activities will be compliant, that the firm’s controllers are fit and proper, and also the firm has appropriate systems and controls in place. FCA authorisation can only be obtained if the each of the requirements are satisfied.

FCA Authorisation (http://fcaauthorisation.info)website is a trading style of Compliance Consultant (http://www.complianceconsultant.org), and our experts have years of knowledge in regulatory compliance and assisting firms with putting together and submitting applications for FCA authorisations. We know the financial services industry and we understand compliance. By having this insight we help our clients create their business model and form their compliance.

All our FCA authorised person and FCA approved person applications are overseen by a Chartered Fellow of The CISI (The leading securities and investment Institute). Our cost-effectiveness and customer focused strategy also means lots of small companies trust us with their FCA authorisation annually. Our team has decades of experience in compliance and regulated financial services. This experience means we understand what the Regulator is trying to find, what the important issues are to address, what typical areas of issue the FCA may have and how you can provide information in such a way that meets requirements and provides the reassurance which the Regulator is seeking.

We can provide structures for submissions and the supporting documentation which sit behind them; and as a standard, we’ll also check all material just before submission.

One of the key qualities of the service is the interpretation and response to any questions or queries which the FCA may raise, helping to ensure the process is as smooth and painless as possible.

If you want us to amend and personalise your policies, we can possibly do this also for an additional cost, but the final edit will be up to you, as it is your business that will be governed by these documents, and you need to ensure they are all singing the same tune.

Whoever you choose you will need to be clear on these issues. Does the price include;.

* Qualified Compliance specialists handling your application.
* All policies and an annual compliance monitoring plan as required by the regulator?
* All forms completed on your behalf (excluding electronic signatures etc).
* All questions before submission at no extra cost.
* Recommendations on wording for text response to explain your firm’s operations.
* All regulator questions and requests for explanations throughout the approval process at no extra charge.
* Professional project management of the process.
* Your questions answered throughout the approval process at no extra cost.

OURS DO!

Consult any of our experts today for discreet and no obligation advice about FCA authorisation on 0207 097 1434

Lee Werrell Chartered FCSI

Compliance Doctor


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Claims Management Companies To Put Their Hands In THEIR OWN Pocket in 2019

Claims management companies (CMCs), known in the financial services compliance business as “Ambulance Chasers” will have to look for more than ₤ 7m in 2019 to set up a compliant scheme to adequately satisfy the regulator the sector, the Financial Conduct Authority (FCA) has revealed.

The approximate price to be paid in 2019-20, if accurate, is 42% of the total initial cost of taking over responsibility for the sector, which under the Financial Guidance and Claims Act 2018 devolves the authority from the Claims Management Regulator on 1 April next year. In total, the authority will recover an estimated ₤ 16.8 m from the sector by 2021, the regulator proposes.

In a consultation paper published at the end of August 2018 the FCA confirms that it is paid for completely by the bodies it regulates; that thanks to the claims management industry’s uncertain future it will need money up-front. When taking up new obligations, the authority can at times defer recovery of the project costs until ‘a substantial body of fee payers’ is in place. The regulator also notes; ‘However, the claims management industry is undergoing considerable change and this uncertainty limits our ability to defer recovery of costs.’

compliance doctor compliance consultants londonThe shake up to the claims management conditions, notably 29 August 2019 deadline day for the submission of cases relating to payment protection insurance,’ might require CMCs to adapt their business models to continue providing claims management services for consumers, and some firms may depart the market entirely’, it notes. Therefore there is a risk that project costs might fall disproportionately heavily on those firms that successfully qualify for authorisation.

‘It would be unfair for firms which take advantage of the regulatory gateway, but which leave within the first year, to pass their share of the project costs to those firms which continue to be authorised by us,’ the consultation paper considers. ‘For this reason, we have decided to collect a substantial proportion of our project costs in the first year.’ This will likely equate to an amount of ₤ 7.1 m in 2019/20, around 42% of the total.

The proposals are set for a rough ride from the claims management industry. Although a vast majority of the firms are likely to exit the industry in 2019, how will the FCA demonstrate that they understand the industry well enough to regulate the remaining firms effectively? Unfortunately, just as a lock only keeps out an honest man, we could end up with disproportionate costs and

infrastructure changes to what amount to be successful, ethical and compliant firms.

claims management authorisation fcaWhenever the CMCs are set to apply for authorisation, there is plenty of help for them to engage with. Compliance Consultant are specialist FCA authorisation consultants and can assist all types of firms get the authorisation process right.

What Does FCA Authorised Mean?Based on the Financial Services and Markets Act (FSMA) 2000, financial activities are regulated by the Financial Conduct Authority (FCA). Any firm carrying out any regulated activity must be authorised by the FCA, unless they are exempt. On Approval They Are FCA Approved Persons.

FCA Authorisations are in some cases tricky and can appear very daunting to the newcomer.Compliance Consultant was created in 2000 to assist providers and individuals in their regulatory compliance requirements, here in the UK, EU and Middle East. We are also long-standing members of the Association of Professional Compliance Consultants (APCC).

Using our application experience developed from the FCA’s Authorisations Team feedback, Compliance Consultant Authorisation Services has succeeded in obtaining authorisation for a large number of clients of all sizes from a variety of fields.

Why Do They Need The Compliance Doctor?

In a speech By Sarah Rapson, Director, Authorisations on the 14th March 2018 at the APCC Conference she stated;”Sometimes firms fail to provide information we request, or they provide the wrong information, or over complicate their responses. This could be because they do not understand our concerns or the questions we ask or why we ask them. If in doubt, they should ask us.Similarly, firms can misunderstand what is required of them, especially where there is new regulation, such as PSD2 or MiFID2. Again, they should speak with us if they are uncertain as to our requirements.From time to time we deal with firms that will not engage with us or do so reluctantly; or they address our concerns in part but not fully. In such circumstances we may well conclude that a firm is not ready to be authorised and could not be supervised effectively. My message is simple; firms need to cooperate with us.Sometimes firms apply for authorisation prematurely, before they are ready to demonstrate that they meet the minimum conditions; at very least this will delay our consideration of their applications, especially if they also fail to provide the information that we require. Firms should apply when they are ready, not to secure their place in the queue.Those are just a few examples. But the common theme is that firms that understand what we are trying to achieve through having a rigorous approach to authorisations and why, are more likely to be successful in their applications.”

The FCA have published a formal policy statement in December, for the rules to become effective from 1 April 2019.

 

Lee Werrell Chartered FCSI

Compliance Doctor

compliance consultants london specialist remedial risk management fca handbook

Claims Management Companies Need To Be FCA Regulated

Claims management companies (CMCs), known in the financial services compliance business as “Ambulance Chasers”must summon more than ₤ 7m next year to set up a compliant scheme to adequately satisfy the regulator the sector, the Financial Conduct Authority (FCA) has revealed.

The sum to be paid in 2019-20, if accurate, is 42% of the total initial cost of assuming responsibility for the sector, which under the Financial Guidance and Claims Act 2018 passes to the authority from the Claims Management Regulator on 1 April next year. In total, the authority will recover an estimated ₤ 16.8 m from the sector by 2021, the regulator projects.

In a consultation paper published at the end of August 2018 the FCA reminds firms that it is funded exclusively by bodies it regulates; that as a result of the claims management industry’s uncertain foreseeable future it will need money up-front. When accepting new responsibilities, the authority can in some cases defer recovery of the project costs until ‘a substantial body of fee payers’ is in place. The regulator also notes; ‘However, the claims management industry is undergoing considerable change and this uncertainty limits our ability to defer recovery of costs.’

The shake up to the claims management conditions, notably 29 August 2019 deadline for the submission of cases associated with payment protection insurance,’ might possibly require CMCs to adjust their business models to keep on providing claims management services for consumers, and some firms may exit the market entirely’, it notes. As such there is a risk that project costs might fall disproportionately heavily on those firms that successfully get authorisation.

‘It would be unfair for firms which take advantage of the regulatory gateway, but which leave within the first year, to pass their share of the project costs to those firms which continue to be authorised by us,’ the consultation paper considers. ‘For this reason, we have decided to collect a substantial proportion of our project costs in the first year.’ This figure will likely equate to an amount of ₤ 7.1 m in 2019/20, around 42% of the total.

The proposals are set for a rough ride from the claims management industry. Although a vast majority of the firms are likely to exit the industry in 2019, how will the FCA demonstrate that they understand the industry well enough to regulate the remaining firms effectively? Unfortunately, just as a lock only keeps out an honest man, we could end up with disproportionate costs and infrastructure changes to what amount to be successful, ethical and compliant firms.

Whenever the CMCs are set to apply for authorisation, there is plenty of help for them to engage with. Compliance Consultant are specialist FCA authorisation consultants and can assist all types of firms get the authorisation process right.
What Does FCA Authorised Mean?Based on the Financial Services and Markets Act (FSMA) 2000, financial activities are regulated by the Financial Conduct Authority (FCA). Any firm carrying out any regulated activity must be authorised by the FCA, unless they are exempt. On Approval They Are FCA Approved Persons.

FCA Authorisations are in some cases tricky and can appear very daunting to the newcomer.Compliance Consultant was created in 2000 to assist providers and individuals in their regulatory compliance requirements, here in the UK, EU and Middle East. We are also long-standing members of the Association of Professional Compliance Consultants (APCC).

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Using our application experience developed from the FCA’s Authorisations Team feedback, Compliance Consultant Authorisation Services has succeeded in obtaining authorisation for a large number of clients of all sizes from a variety of fields.

Why Do They Need Compliance Consultant?In a speech By Sarah Rapson, Director, Authorisations on the 14th March 2018 at the APCC Conference she stated;”Sometimes firms fail to provide information we request, or they provide the wrong information, or over complicate their responses. This could be because they do not understand our concerns or the questions we ask or why we ask them. If in doubt, they should ask us.Similarly, firms can misunderstand what is required of them, especially where there is new regulation, such as PSD2 or MiFID2. Again, they should speak with us if they are uncertain as to our requirements.From time to time we deal with firms that will not engage with us or do so reluctantly; or they address our concerns in part but not fully. In such circumstances we may well conclude that a firm is not ready to be authorised and could not be supervised effectively. My message is simple; firms need to cooperate with us.Sometimes firms apply for authorisation prematurely, before they are ready to demonstrate that they meet the minimum conditions; at very least this will delay our consideration of their applications, especially if they also fail to provide the information that we require. Firms should apply when they are ready, not to secure their place in the queue.Those are just a few examples. But the common theme is that firms that understand what we are trying to achieve through having a rigorous approach to authorisations and why, are more likely to be successful in their applications.”

The consultation on the proposals runs to 22 October. The FCA will publish a formal policy statement in December, for the rules to go live from 1 January 2019.

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