A compliance monitoring programme must describe the actions the holder of the compliance oversight function and their staff will take to ensure the Applicant complies with the FCA’s rules and guidance at all times, in particular:
- what checks will take place;
- how often the checks will take place, as appropriate to the procedure being checked – this might be daily, weekly, monthly, quarterly, annually or another period specified by the FCA;
- who will carry out the checks – this is the role of the person who will make the check, such as the Compliance Officer, Training and Competence Officer, Money Laundering Reporting Officer; and
- what records of the checks will be kept to confirm they have taken place.
Compliance Monitoring Programme
The following checks will take place with the relevant points included in the assessment report. Persons responsible for the checks are the directors of the company with some help from their assistants. All of the checks will be conducted at least annually unless otherwise specified below as well as on an ongoing basis as necessary and as part of the day-to-day running of the business.
Monthly review of new business records to ensure that they are complete and carried out in a timely manner. Monthly reviews of financial promotions to ensure that they are:
- Clear fair and not misleading
- Pricing/saving claims meet majority rule
- Statistics and customer quotations are current
- Promotion is current
- All marketing communications are clearly identifiable as such
Monthly reviews of all document re-prints or new document production to include a check on status disclosure.
- Annual review of complaint records to include:
- How the complaints have been handled
- Classification of eligibility of complaints
- Issue of letters in line with FCA time standards
- Issue of FOS leaflets
- Review of record keeping
Annual review of the recruitment process in place including following checks. Recruitment process for directors and other approved persons to include FCA approval. DBS and credit checks to be conducted.
- Competency assessment
- Regulatory Reference check
- Qualification check
- Declaration/check on financial standing and criminal records
Annual review of the training and competency scheme in place including:
- Competency assessment criteria
- Assessment of competency for new staff,
- Training records in place, including Conduct rules
- CPD records
- Minimum 15 hours per annum for relevant staff covering the prescribed areas
- Appraisal of staff including competency assessment and personal development plan.
Annual appraisals to include annual declaration by all staff on financial standing and criminal records. DBS checks to be carried out as appropriate.
Annual review of controlled functions. Annual declaration of fitness and propriety by all persons with controlled functions. On-going DBS and credit checks as appropriate.
Senior Managers and Certification Regime (SMCR) – Suitable records are kept and maintained. All senior managers to have up to date Statements of Responsibilities. Prescribed Responsibilities are allocated appropriately. Senior managers understand their duty of responsibility. All Certification staff to have formal certificates issued at least annually. All staff to understand the relevant Conduct rules. Regulatory references obtained/provided and updated as appropriate.
Conflict of interest records are kept. Conflict management policy in place. Reviewed as part of business risk management process. Entertainments register in place. Inducements/bonuses, etc. reviewed to ensure no conflicts with customers’ best interests. Reviewed regularly at board meetings.
Regular reconciliation of assets and liabilities – part of monthly management accounting process.
Notify the FCA immediately of any material breaches of FCA principles/rules. Notify breaches of Conduct rules in accordance with the required timescales. Maintain rule breach register as part of the compliance breach reporting process. Review of compliance breaches by the board. Process for notifying FCA of breaches and changes requiring approval in place. All notifiable breaches are immediately notified to FCA. Conduct breaches reported immediately for Senior Managers and annually for other staff. Reviewed as part of the compliance audit process.
Annual review of the FCA approval granted for changes to:
- Accounting date
- Permitted regulated activities
- Directors and approved persons
Process for notifying FCA of breaches and changes requiring approval in place. Notification to FCA immediately the firm is aware of the change.
Adequate management information maintained and provided to senior management including TCF. Management information agreed and reporting is in place. Regular review of management information by the board.
Ensure that the documented compliance procedures are maintained and used in conjunction with an up to date copy of the FCA handbook, compliance procedures in place, Handbook changes reviewed and where required compliance procedures updated.
Products – Firm complies with the FCA requirements for Product Distributors. Review arrangements with other brokers, lenders and other providers to ensure adequate information is provided by them on product characteristics, product approval process and target markets.
Proceeds of crime regulations (Money Laundering) are complied with. Process in place to identify and report on suspicious transactions. Reviewed by the board on a regular basis.
Data Protection. Procedures in place to comply with DPA 2018 and GDPR requirements. Reviewed by the board on a regular basis.
Compliance auditing and breach reporting procedures in place. Compliance auditing and breach reporting in place. Reviewed by the board on a regular basis.
Treating Customers Fairly / Conduct Risk. Gap Analysis undertaken on an annual basis. TCF MI in place to measure performance against 6 consumer outcomes and to identify any risks/issues that require actions. TCF Action log in place and acted upon
Financial Crime. Staff trained on an annual basis. NCA reporting in place. Review businesses against Financial Sanctions report.
Information Security. Annual Audit in place.
Financial Services Register / Directory. On-going review of the accuracy of the entries. (From December 2020) Formal annual confirmation of the accuracy of Directory entries.