News

Below you will find a range of published articles which I hope you find of interest. You may also be interested in obtaining a copy of a book of which Anthony Smith is one of the co-authors through the link below. A topical news item will be added on a regular basis and I am more than happy to receive contributions via our Contact Page.

Order your copy of the Frontiers of Risk Management from EuroMoney Books.

All news articles

82 items found

Platform propositions

Published: March 2017
By: Anthony Smith

http://citywire.co.uk/new-model-adviser/news/how-to-meet-fca-due-diligence-expectations-on-platforms/a991613?ref=new_model_adviser_features_list

Understanding your platform proposition
If firms often struggle with understanding their model it is little wonder that advisers may have difficulty understanding how their platform operates and where they should direct their due diligence when deciding on their chosen platform(s) in line with FCA’s expectations.....

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Platform due diligence

Published: February 2017
By: Site Administrator
http://citywire.co.uk/new-model-adviser/news/how-to-meet-fca-due-diligence-expectations-on-platforms/a991613?ref=new-model-adviser-todays-news-list

Crash Bank Wallop

Published: January 2016
By: Anthony Smith

Having read the book now you can't help wondering how on earth Mike Ellis can continue as Chairman of Skipton Building Society.  As  Paul's boss he failed to support him and stood by allowing 'Group Think' to continue unchallenged despite being the board member responsible for risk management at the bank when Paul was sacked.  This disgraceful episode ultimately led to the collapse of HBOS in 2008 and he must be held accountable for his part along with the other senior management names in the Read More...

Crash Bank Wallop

Published: November 2015
By: Anthony Smith

Paul Moore has finally publish his book Crash Bank Wallop which contains a lot of previously unseen evidence around the crash of HBOS and in particular the culpability of those involved.  Written from information gathered from the inside of the bank, up to his sacking by James Crosby in 2004, Paul Moore is able to document the seeds of the banking crisis and his warnings about what was to come.

My contribution in February 2009, confirming that Paul's replacement was not an experienced risk manager, is also featured in the book and the e-book contains a link to my contribution.....

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Loans secured on property

Published: November 2015
By: Anthony Smith

Following a query I thought it prudent to point out that if you want to make a loan secured on a residential property then this is a regulated activity requiring authorisation. 

For example someone wanted to make a loan to people buying a pub.  That is fine but it cannot be secured on the pub if the landlord is living there without taking out a regulated mortgage.  Anyone can make a personal loan on a one to one basis but be careful if the loan is secured on property.....

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Crash Bank Wallop

Published: October 2015
By: Anthony Smith

A great book that finally gets to the heart of the matter.  Well worth crowd funding:

https://www.crowdshed.com/projects/crash-bank-wallop

 

Inducements and commission in GI

Published: May 2015
By: Anthony Smith

The FCA really need to tackle the inconsistencies between investment business and general insurance over inducements and commission.  In Plevin v Paragon Personal Finance Ltd the court ruled that failure to disclose a large commission payment to the client made the relationship between the lender and the borrower unfair.

It seems that once again that principle based rules do not work where they rely on the goodwill and positive interpretation of the industry to act within the spirit of the rules.....

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Shortfall Funding

Published: May 2015
By: Anthony Smith

PS14/9 has clarified the requirement to fund for shortfalls that are the firm's responsibility as soon as they are identified until they are resolved.  Previously firms only looked at identification at reconciliation time and then only if they remained outstanding for 90 days to allow time for investigation.  However, the new rules clarify the requirement to fund and state that shortfalls should be funded, as soon as they are identified, even outside of the reconciliation process.....

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External and Internal Custody Reconciliations

Published: March 2015
By: Anthony Smith

As the PS14/9 June deadline approaches we turn our thoughts to completing compliant custody reconciliations.  For many firms the internal reconciliation has often been a circular reconciliation with no particular merit.  The FCA have introduced the 'system evaluation method' which enables firms to complete a series of checks to ensure their records are accurate where a true reconciliation against double entry book keeping is not possible.....

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PS14/9 and the need for CASS Expertise and Training

Published: March 2015
By: Anthony Smith

As I work my way through the platform and distribution market I find an increasing demand for CASS expertise and knowledge.

The reality is that reading the Lehman's high court judgement is not first on the list of priorities but you will find there the basis of the latest round of regulatory change as the CASS rules are clarified.

The final implementation date of 1st June will soon be upon us and I suspect a number of firms will have missed key requirements, which will no doubt catch them up later on down the line.....

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Compliance Monitoring Programme CMP

Published: February 2015
By: Anthony Smith

Ever thought how frustrating it can be to follow up on compliance monitoring findings and then track backwards through your reports and findings to ensure you have all the answers you need?  Well your problems are over with out latest solution to compliance monitoring that gives a full audit trail and enables planning as well as audit and follow up all in one package.

Working with my colleagues in Mettis we can provide a cloud based solution that can be based on your servers and backed up in the cloud.....

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Risk and Compliance Opportunities in Technology

Published: February 2015
By: Anthony Smith

Our approach to investing technology in risk and compliance opportunities

We invest our technology and business capability in opportunities that provide companies with BRAND ASSURANCE. We create these opportunities together with content experts to commercialise industry knowledge that disrupts the risk and compliance landscape by:

  • empowering clients through cloud-based technology;
  • making them more self-sufficient;
  • enabling control of critical brand assurance functions

We strive to be innovators and drivers of this paradigm shift by empowering and enabling early adopters and partners, and by making solutions available on usage or consumption based pricing models.....

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HBOS collapse report delayed

Published: January 2015
By: Anthony Smith

The reasons for HBOS demise are clear and unambiguous. Firstly they ignored the obvious risks being taken in the Treasury function claiming 'the models are correct'. They got rid of a decent risk director and replaced him with the head of retail i.e. they put sales in charge of compliance!

They ignored staff that highlighted wrong doing, including moving staff that protested against PPI misselling and making a number of key risk personnel redundant.....

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Transaction Reporting Fine

Published: August 2014
By: Anthony Smith

http://www.fca.org.uk/news/press-releases/deutsche-bank-fined-transaction-reporting-failures

Another reminder of the srious consequences of failing to submit accurate transaction reports.  Working with my colleagues in Cape Town we have developed a solution to enable consultants to check these reports against a rules engine to ensure they are completed in accordance with the rules requirements.

Enterprise Risk Management

Published: August 2014
By: Anthony Smith

Recording and reporting risk events and breaches should not be that painful and connecting these up with corporate risk frameworks and obtain a global overview of risks at different levels.  Using platform technology that is cloud based enables fast implementation in a matter of weeks dependent on the client to provide the hierarchy and risk details for registering.

We do not charge licence fees but charge by usage which makes life a lot simpler and the costs easier to manage.....

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Ethical behaviour and conduct risk

Published: March 2014
By: Anthony Smith

So the Economist Intelligence Unit’s findings that 53 per cent of financial services executives believe career progression at their firm will be difficult without “flexibility over ethical standards”.  Martin Wheatley might well think this is 'Un-be-liev-able'*.

When you think of all the scandals going through the banks there really does seem to be a problem with culture.  Board members should have high ethical standards and believe in doing the right thing.....

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Scottish Independence

Published: February 2014
By: Anthony Smith

How worried should we really be?

The lack of a common currency union would mean Scottish banks are no longer backed by the Bank of England.  A separate regulator and compensation scheme means there would be no backing by the FSCS in due course.  Similarly with Scotland's application to the EU being by no means guaranteed there would be no common compensation standards applied.

Halifax now has a Bank of Scotland banking licence so all its customers would be affected.....

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Finalised Guidance on Inducements

Published: February 2014
By: Anthony Smith

It seems a pity to me that this guidance was ever necessary.  The rules are quite clear and have not changed significantly since 1988. 

I am glad the FCA think paying for meetings with senior managers is unlikely to meet the requirements of the inducement rules.  I said as much over a decade ago and never allowed such payments to be made.  Similarly paying for MI that the firm is often likely to obtain from other sources and has no real value is also banned.....

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Another massive banking fine

Published: December 2013
By: Anthony Smith

When you thought the fines had grown large enough Lloyds is hit by £28,038,800 fine for serious sales incentive failings.

When you read the details it beggars belief how anyone passed this through Compliance or even used the slightest modicum of common sense to think it was remotely acceptable.  In fact it highlights a moral vacuum at the heart of Britain's largest UK retail bank that every customer should shudder with contempt at the way they have been treated.....

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Another NMPI fine

Published: December 2013
By: Anthony Smith

Westwood Financial lost their fight with the Tribunal against a £100,000 fine for misselling geared traded endowment policies (GTEP).  There were examples of clients taking out mortgages to invest in GTEPs; a form of double gearing, which is very high risk particularly for unsophisticated clients.  On the face of it this seems an open and shut case of blatant misselling without any redemption.  How could anyone think this type of activity was ever suitable for the clients concerned or indeed any client?....

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SEI fined 900,200

Published: November 2013
By: Anthony Smith

In yet another massive fine for CASS breaches the FCA continues to apply pressure on firms that do not take CASS compliance seriously.  Over a prolonged period SEI failed to adequately protect client money and performed a non compliant reconciliation process without even realising it.  The stand out comment is the untrained member of staff adjusting a client money shortfall from £14 million to £932,000 because the shortfall was of an unprecedented amount and therefore must have been inaccurate.....

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Share Class Conversions GC13-7

Published: October 2013
By: Anthony Smith

After announcing a ban on rebates from April 2014 the FCA relented in their quarterly consultation to some extent by allowing legacy rebates to clients and advisers to continue indefinitely.  Rebates on new business will cease including increments to regular payments but not re-registrations where assets are not sold and repurchased.  However the ban on payments to platforms remains and is to be completely phased out by April 2016.....

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FCA clamp down on inducements

Published: September 2013
By: Anthony Smith

COBs 2.3 has been around for a while and copied out of the old COB rules going right back to Lautro indirect benefit rules. RDR added a bit of clarification but didn't really change the rules just drew them back to the attention of everyone concerned as a possible mechanism to bypass providers paying distributors but really product bias and conflicts of interest has been in the rulebook for decades.

The FCA are playing catch up for rules that have been overlooked in the past and bad practice that has been allowed to get out of hand.....

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Aberdeen fined 7.2 million for client money breaches

Published: September 2013
By: Anthony Smith

Failing to correctly identify client money and put it in trust puts client money at risk if the firm goes bust.  If Aberdeen went into liquidation there was a real risk of delay in payment of client monies to their rightful owners.  This happened with Lehmans and is why the regulator is so hot on this topic. 

When it comes to client money the FCA work to the 'Armageddon' standard which is understandable when you consider the fall out from the financial crisis and what were thought to be solid organisations.....

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The cloud a replacement for spreadsheets

Published: August 2013
By: Anthony Smith

 

It is surprising how many firms are so dependent upon the use of excel spreadsheets.  Operational risk managers often use them to complete their critical risk assessments with a proliferation of red amber greens.  Whole finance teams may carry out their daily calculations and reconciliations using complex formulas in excel with many tens or even hundreds of thousands of lines taking hours to complete their tasks such that they may have to be left to run overnight so the user can pick them up in the morning.....

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Ban on rebates or not?

Published: August 2013
By: Anthony Smith

In its policy statement PS13/1 the FCA signaled an end to rebates being paid to advisers or platforms for new business from 6 April 2014 and a total ban on existing rebates by April 2016.  However in a recent note to trade bodies the FCA now say that legacy rebates to retail customers could continue indefinitely and intend to consult again in September.  However this is dependent on the fund remaining in place without any switches; buys or sells taking place that would result in part or all of the fund being placed in funds which do not allow for cash rebates.....

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CASS rules revised and updated

Published: July 2013
By: Anthony Smith

The FCA have finally reviewed the client money and asset rules and put the changes out for consultation.  The details can be found on the FCA website and responses for chapter 8 (Mandates) changes must be provided by 12th August and the rest by 11th October 2013.

On the whole the rules provide more granularity and follow a trend of moving away from principle based rules into more prescriptive requirements in areas where the regulator feels firms have struggled to interpret their requirements.....

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Clean share classes

Published: May 2013
By: Anthony Smith

Following the HMRC announcement that rebates will be taxed for assets held outside a tax wrapper the demand for clean share classes has oustripped supply.  The FCA platform paper also confirms that rebates to customers must cease from 6th April 2014 so a massive switch to clean share classes is now essential to comply with FCA rules.

There is nothing to stop funds providing unit rebates and some of the larger platforms are negotiating for low charged share classes especially for them (which will lead to significant problems for reregistration).....

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Determining the Asset Universe

Published: May 2013
By: Anthony Smith

This essential task is surprisingly one that a lot of platforms and life companies have failed to get on top of.  Funds proliferate and in the case of platforms all manner of unregulated collectives (UCIS) and exotic investments creep their way on until they are lost in the midst of thousands of ordinary retail funds.

Working with Mettis we have a tool to cleanse the data and filter out the good from the bad.  We also use the expertise of fund consultants to review outliers and end up with a clear list of funds and assets that are properly categorised and identified.....

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Anthony Smtih works with Mettis

Published: April 2013
By: Anthony Smith

Anthony Smith is working with Mettis to provide revenue reporting systems for UK financial services including ISACOM, S18/USD and pensions reporting.  In addition we provide compliance and TCF MI systems in the UK and SA. http://www.mettisinteractive.com/web/news/2013-03-06.php

 

Oh how the mighty have fallen

Published: April 2013
By: Anthony Smith

I continue to hear people question whether any regulations or laws were broken at the time the banks failed and in the lead up to that.  One would think that regulation had just been invented and that we had not had financial regulation since 6th April 1988 when the Financial Services Act 1986 first came into effect or the FSA came into being at midnight 30th November 2001.

The FSA Principles for Business required the Directors to manage the bank in the interests of its customers, to treat them fairly Principle 6, to run its business with due skill, care and diligence Principle 2 and to take reasonable care to organise and control its affairs responsibly and effectively, with adequate risk management systems Principle 3.....

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Inducements

Published: March 2013
By: Anthony Smith

Perhaps I've been around for too long in compliance but wasn't it always the case that you weren't allowed to pay an adviser or network anything outside the inducement rules?  Back in Lautro days we talked about indirect benefits and some people still do.  Things like a congratulatory advert was banned as that was a benefit to the IFA outside the indirect benefit rules and would still be in breach of the current inducement rules as it has no benefit to the client and is simply a free advertisement.....

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CMAS Conference

Published: March 2013
By: Anthony Smith

I have been invited to appear as a panellist in the Compliance Monitoring and Assurance Strategy CMAS 2013 Infoline conference on 21st and 22nd May 2013.  You can find more information on www.infoline.org.uk/CMAS and don't forget to quote FKM62565AD for a VIP discount of 20%

Banking Culture

Published: January 2013
By: Anthony Smith

With all the news on LIBOR rates and PPI misselling it is not difficult to see why people have issues with the banks.

There do seem to be significant issues with TCF even now, despite all the fines etc.  BBC Moneybox recently reported the client that had his credit limit reduced whilst he paid for car service then found the bank had reduced his credit limit.  During the bad weather the post was delayed so he found two letters one reducing his credit limit and the other threatening him with debt collectors.....

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FSA Held to Account

Published: December 2012
By: Anthony Smith

I saw this interesting e-petition from a rambling rant following the announcement of the knighthood of Hector Sants in Citywire.

https://epetitions.direct.gov.uk/petitions/31608

http://citywire.....

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RDR

Published: December 2012
By: Anthony Smith

The Retail Distribution Review commences on 31st December and brings in a whole host of changes to financial advisers including level 4 qualifications and a ban on commission.  There is a knock on impact to product providers and platforms who are also banned from paying for distribution.

The FSA has focused on adviser charging and platform services and rebates.  However their policy purpose goes much wider and intends to ban any form of payment by providers to distributors.....

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Platforms and Regulatory Change

Published: November 2012
By: Anthony Smith

Platforms and Regulatory Change

It has been a busy year for platforms and regulatory change not the least being RDR requirements that go beyond adviser professionalism to the complexities of facilitating adviser charging, the impact on white labels and obtaining consent from the retail client, as well as planning for the ban on rebates and the issue of fund short reports in 2013.
 
In addition to RDR there has been the ongoing reform of the CASS rules including implementation of the CASS Resolution pack as well as UCITs IV KIIDs requirements in July, changes to SIPP illustrations requirements, new guidance on the use of model portfolios and increased focus on UCIS.....

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FSA requires providers to obtain consent from the retail client

Published: October 2012
By: Anthony Smith

The FSA have written to life companies requiring them to attest that they will obtain and validate adviser charging consent from the retail client.  Some firms are relying on the financial adviser to confirm they have an adviser charging agreement in place but the FSA say this would be in breach of the COBS requirements.

I have even seen a platform provider suggest their adviser simply fill in a box on the platform without receiving anything from the client they will simply stop paying commission and start paying charges.....

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RDR changes DFM Payments CP12/27

Published: October 2012
By: Anthony Smith

Another update to the rules slipped in to the quarterly consultation CP12/27.  In effect it clarifies what was guidance and confirms that DFMs should not be paying financial advisers for referring clients to them in the same way as product providers cannot pay commission and rebates to platforms will be banned next year.

The rules make it clear that any service provided in respect of a DFM agreement is a related service and as such is caught by the adviser charging rules.....

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Risk Profiling Tools and Personal Recommendations

Published: September 2012
By: Anthony Smith

http://www.citywire.co.uk/new-model-adviser/fsa-warns-exec-only-platforms-over-accidental-advice/a621555?re=20725&ea=315088&utm_source=BulkEmail_NMA_Daily_EAM&utm_medium=BulkEmail_NMA_Daily_EAM&utm_campaign=BulkEmail_NMA_Daily_EAM

I think the FSA may be over egging this though worth watching.....

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End of an era at Burns-Anderson

Published: July 2012
By: Anthony Smith

I was sad to hear the news about the collapse of Honister and the demise of Burns-Anderson. 

I ran the Pensions Review and we were the only large network not to be fined by the PIA.  I understand we were described by the Treasury as 'the good guys' though there was a lot of pain for many of the members especially those that sadly didn't make it.  In fact despite the 'success'; the cost of the Pensions Review put plans to launch on AIM on the shelf and things never went well throughout the new millennium with the ultimate demise of Honister and the end of the once 'quality network'.....

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Banking Woes

Published: July 2012
By: Anthony Smith

As the problems over LIBOR fixing and the resignation of the chairman of Barclays gets underway the challenge of banking culture comes under the spotlight yet again.  In fact it is wider than that as LIBOR is an international measurement and the fixing scandal has the scope to seriously damage the reputation of the City.

Having worked in a bank at Group level I experienced first hand the problems with banking culture, which eventually resulted in my taking redundancy at the same time as a number of my colleagues who were particularly identified for daring to challenge.....

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Addressing regulators worries over outsourced investments

Published: June 2012
By: Anthony Smith

There continues to be a lot of misleading articles in the press on this subject and here on this blog I continue to argue the case for advisers being able to advise on the suitability of model portfolios without requiring permissions to manage investments or outsourcing to discretionary fund managers.  That is not to say I endorse the merits of so doing and understand the FSA's concerns about 'shoehorning' and some of the costs involved but these are different arguments altogether.....

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DFMs and Model Portfolios

Published: May 2012
By: Anthony Smith

Discretionary Portfolio Advice Services, as used with Model Portfolios, do not amount to Discretionary Portfolio Management and do not require additional permissions.  This is made clear in the Regulatory Risk Outlook 2011 and the page number and section are clearly referenced in the Guidance Consultation should there be any doubt.

An adviser that recommends a Model Portfolio is providing advice to a client and not carrying out the activity of ‘managing investments’.....

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DFM Platform Model Portfolios

Published: May 2012
By: Anthony Smith

Following the publication of FSA’s Guidance Consultation (GC12/06) there have been a number of press reports on the permissions necessary to become involved in centralised investment propositions and model portfolios on a platform.

There are a number of types of centralised investment propositions (CIPs) that are summarised in the guidance consultation including portfolio advice services, discretionary investment management and distributor influenced funds (DIFs).....

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HBOS Censured

Published: March 2012
By: Anthony Smith

A lot has been said about the banking crisis and I have a unique insight as one of the so called whistleblowers on this subject.  I also offered my evidence to the FSA at the time but they rejected my offer and refused to confirm any investigation was underway at the time.

There were a multitude of factors including the economic cycle but if you read the enforcement notice you will see the bank ignored all obvious warnings and went full out to pour money into the corporate sector, especially commercial property, without any view on what even a novice could see as a reasonable outcome.....

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10th Annual Financial Services Conference Brussels 9th February

Published: January 2012
By: Anthony Smith

http://www.eu-ems.com/summary.asp?event_id=101&page_id=752

 

An opportunity to meet the movers and shakers in the European arena.

 

Transact CASS Fine 3.5m

Published: December 2011
By: Anthony Smith

The FSA continue to enforce the CASS rules in full regardless of customer detriment.  Transact failed to perform an internal reconciliation for 8 years and had inadequate systems and controls with a lack of experienced senior staff.  Compliance failed to pick up the breaches and relied on audit opinions which also failed to identify the breaches; no excuse for the FSA.

This highlights the need for competent staff who understand the CASS rules at a senior level.....

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Mandates

Published: November 2011
By: Anthony Smith

A subtle change in SUP 3.10.5R (1) brings mandates into the CASS audit.  The requirements are simple enough but the application is very wide including fund managers who control and invest client money in a fund.  If you have your CASS audit and find questions being asked about where your authorities are held and the security measures in place then this is why. 

The CASS Audit also has to record all breaches in much more depth than before so records better be up to date an in good order.....

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CASS Fine

Published: October 2011
By: Anthony Smith

Another client money fine from the FSA with a £494,000 fine for Towry sends a strong message from the regulator that they will not tolerate errors in the handling of client money especially when you tell them nothing is wrong.  Somehow a response went to a Dear CEO letter saying they complied with the CASS rules when clearly there were significant problems.

This is all about segregation and timely reconciliations.  Although there was a surplus of money in the pot the reconciliation process had not clearly split out client money and firm's money and without accurate reconciliations there could have been delays in the event of a default.....

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CMAR Training

Published: September 2011
By: Anthony Smith

If you are looking for CMAR training as a MiFID firm (CASS 6 and 7) you may find an out of date course on the FSA website for the princely sum of £10.  It includes chapters of CASS that no longer exist and does not cover the change in approach since Lehmans including the new rules on binding authorities, CMAR, CF10a and the proposal for recovery plans for CASS firms.

Don't be caught out but talk to an expert.

....

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UCIS

Published: September 2011
By: Anthony Smith

The FSA have issued yet another fine for missale of unregulated collective investment schemes (UCIS).  This time they have also issued prohibition orders against directors including the Compliance Officer.  

When will firms learn the simple requirements for promoting these products?  Basically you cannot generally promote them and only consider certain select clients for whom they may be suitable.

It is also worrying some of these investments appear on platforms and without proper protections could be selected unawares.....

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CMAR

Published: September 2011
By: Anthony Smith

The time for producing the Client Money and Assets Return (CMAR) is fast approaching and firms are pulling together their data ready to go to the FSA. Data is required from 1 October and must be submitted within 15 business days of the month end i.e. 19th November 2011.

Our Cloud technology powered by Mettis provides the right tool to complete the return in a fully automated format so the figures can be ready to be submitted in moments.....

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Capital returns

Published: August 2011
By: Anthony Smith

The FSA focus on capital returns has highlighted potential errors in the way capital has been created in firms and the use of hybrid capital from preference shares.  Have your Articles of Association been updated to take account of GENPRU?  Well the changes in January 2007 may already take preference shares out of the equation and the latest changes with effect from 31 December 2011 means that no new hybrid capital is allowed and new preference shares cannot be counted as tier 1 capital without signifcant changes to the Articles of Association.....

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CASS

Published: August 2011
By: Anthony Smith

CASS compliance has become a fear factor in many firms with the numerous fines dished out by the FSA.  The requirements to submit a CMAR and appoint a CF10a create a number of challenges.  

A good CASS governance structure is very important that addresses all the governance requirements necessary to ensure things do not slip when strategic or external change comes along.  There is much to consider and often the CASS obligations of a firm sit at the heart of its operational structure.....

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Platforms the Future

Published: August 2011
By: Anthony Smith

The head long rush into platform technology has been taken on by the life companies wishing to continue doing business post RDR as well as taken on enthusiastically by the wealth managers.  AJS Consultancy Services has been at the heart of these developments creating new investment companies for life insurers and processing their Part IV applications as well as working with the leading platform provider on delivering compliant solutions.....

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Auditing for Insurers Amman Jordan

Published: June 2009
By: Anthony Smith

Anthony Smith speaks to an international middle eastern insurance company's group of internal auditors. Arabic, Greek and English speaking tables discussed auditing different parts of insurance including underwriting, reinsurance, finance, new business and servicing. Marine, Solvency II, IFRS7, the fall out from the financial crisis and much more were discussed and reviewed over 2 days in Amman.

The weather was hot and security tight.....

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Managing the Regulatory Footprint

Published: April 2009
By: Anthony Smith

Many investors consider putting their nest egg into offshore investment bonds to take advantage of 'tax free' roll up and protection from inheritance tax through trusts. However local tax requirements will still apply and there may be other restrictions on the way to policy is sold depending on the residency of the policyholder.

The impact of the global recession has brought increasing attention to the offshore financial services industry and brought greater attention by governments on the retention of precious tax revenues as the impact of the credit crunch reduces the amount of revenue through regular sources.....

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CRD Brussels November 2008

Published: November 2008
By: Anthony Smith

A topical subject given the state of financial markets.

It was suggested that if Basel II had been fully implemented in the States then the current crisis may have been prevented. However it was meant to be fully implemented in Europe in January 2008 but the current problems have still occurred. One worrying observation was that some banks are now too large to rescue.

A regulatory paradign shift is required.....

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TCF Workshops

Published: June 2008
By: Anthony Smith

Treating customers fairly (TCF) is one of the key planks in the Financial Services Authority’s (FSA) move to Principle Based Regulation (PCR). Having to implement a series of European directives the FSA are challenged by a rule book that is just too big. If FSA do more than Europe dictates they could be left to go cap in hand to the Commission accused of ‘gold plating’.

But why focus on TCF specifically when there are 11 Principles?....

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Business Planning and Support

Published: June 2008
By: Anthony Smith

Business planning and support is another service I am offering to customers. Working with management consultants and accountancy trained business advice experts we can review your accounting systems and management controls to ensure you are getting the best value out of your business.

I have always believed that compliance is really a matter of best business practice. Doing the right thing isn't about putting up barriers to sales but delivering long term profitable business with happy customers who know they are being treated fairly.....

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Calling all CEOs

Published: June 2008
By: Anthony Smith

Have you ever wondered who in your firm was responsible for a particular FSA Handbook requirement? Could you easily identify where responsibilty lay in your business and whether you had apportioned responsibility to the appropriate approved person? Perhaps it all lies on your shoulders should the FSA come knocking?

Even in very large firms it is possible to map out the FSA Handbook to enable all the relevant rules to appear against one or more approved persons.....

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UCITS Brussels 27 November 2007

Published: November 2007
By: Anthony Smith

UCITS represent 75% of investment in Europe but uneven implementation of directives and non-standardised costly notification procedures has led to a further review and a possible revision of UCITS III. Another lively debate with many leading speakers from across the globe gathered on a grey day in Brussels.

Nial Bohan Head of Unit Asset Management, DG Internal Market, European Commission began the UCITS conference praising the success story of UCITs.....

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Principle Based Regulation - Noticing the wallpaper

Published: March 2007
By: Anthony Smith

In the March Epsilon E-zone I touched on the thorny questions of Principle based regulation and what it might mean for firms as MiFID began to drive it through the regulatory agenda. The FSA put out a seminar invite on the subject and had over 600 enquiries forcing them to book a bigger venue so it’s obviously a hot topic right now.

Of course there is nothing new under the sun and as far back as Discussion Paper 18 the FSA put out the feelers on how they saw the evolution of firms from mechanical compliance through to values based firms who went beyond just having a compliance culture or even being beyond compliance to a utopian vision of mature relationship benchmarking built on ethos and values that drives a firm to question its motivations and challenge behaviour from within.....

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European Financial Directives 07

Published: March 2007
By: Anthony Smith

We were fascinated to learn the European Commission were busy working on their new Mortgage white paper as we speak. We have the Council of Mortgage Lenders speaking at the European Financial directives Conference and many others who may be able to reveal more. It just goes to show that European Directives are not just about MiFID as our conference on 29 March clearly demonstrates.

We are currently going through a year of unprecedented regulatory change with the implementation of MiFID and CRD and the FSA’s ambitious programme to reform the Conduct of Business rulebook and move towards principle based regulation all at the same time.....

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2nd Annual Conference European Financial Directives

Published: December 2006
By: Anthony Smith

2nd Annual Conference European Financial Directives
6 March 2007 London

During East week 2006 we saw around 100 people attend the inaugural European Financial Directives conference in London. This followed a successful event in Brussels’ which was repeated this November to a full house. These events have proved very popular but conscious of the fact that a number of delegates were unable to attend due to the Easter holidays we have chosen a date when as many as possible should be able to make it.....

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MiFID Implementation Brussels

Published: November 2006
By: Anthony Smith

MiFID Implementation

The Commission has a challenging time ahead as the time will be as agreed and there will be no further extensions. There will be eight workshops to ensure member states arrive at a common positions and interpretations on implementation and details will be published on their website. CESR are working with experts on level 3 through European experts group for MiFID and other directives. For example determining the boundaries between UCITs and non UCITs transactions in the context of branches.....

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MiFID in Exeter

Published: July 2006
By: Anthony Smith

HM Treasury’s role with MiFID is in negotiations with the EU over legislation and changes to UK legislation. MiFID is a key EU directive affecting the buying and selling of financial instruments and began with the Financial Services Action Plan in 98/99 with a view to achieving a long established aim of a single market in investment services throughout Europe. The ISD had failed to remove barriers as member states could put up their own restrictions and the UK very much championed the cause rather than MiFID being something imposed by Europe.....

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A View from the Regulator Edinburgh

Published: July 2005
By: Anthony Smith

We were pleased to welcome Duncan Gracie, Manager Small Firms Division and Geoff Rae, Associate from the FSA’s Edinburgh office, together with John Bourbon on 28 July at the Edinburgh office of Deloitte. Andrew Murray, Regional Chairman chaired the proceedings. Our thanks go to Deloitte for their hospitality in hosting the event.

The FSA’s Edinburgh presence had been low-key and there was a relatively small team doing mostly desk based monitoring.....

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Financial Promotions Cardiff 2005

Published: July 2005
By: Anthony Smith

The South West (and Wales) region was pleased to be welcome back once again to the capital of Wales by our hosts Legal & General. We were especially privileged to here from Tony Katz, FSA Financial Promotions Manager and Mike Cowie Legal & General’s Regulatory Developments Technical Manager a name familiar to most of us having worked for many years at PIA and FSA. We were also pleased to see a good attendance at the event especially to new members attending their first meeting.....

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Disclosure

Published: May 2005
By: Anthony Smith

Disclosure – key points – Depolarisation Seminar 23 February
• We ran through 6 questions on disclosure and the Menu with most of the audience split on the answer or failing to offer an opinion, so a lot of confusion out there on what is required.
1. If an IFA offering mortgages, investment and general insurance do you need to use the CIDD by 1 June?
2. Can a fee only IFA receive commission for protection only products?....

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FSA Supervisory Focus and handling an Arrow style visit

Published: May 2005
By: Anthony Smith

The South West region was pleased to welcome Steve Williams, Retail Firms Division Manager of FSA, and Kate Fleming and Philip Ryley of TLT, to talk about risk based supervision and dealing with an FSA ARROW style visit. We also express our thanks to TLT solicitors for hosting the event. We were also grateful to John Bourbon for attending his first event in the South West.

Steve began his presentation explaining how risk-based supervision assists FSA to meet its objectives by embedding the principles of good regulation and focuses on key risks using thematic and other regulatory tools.....

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Depolarisation

Published: May 2005
By: Anthony Smith

Another successful joint event with the Insurance Institute of Bristol brought an audience of around 70 people on a cold snowy afternoon at Axa on the edge of north Bristol. Fay Goddard Director of Policy, AIFA and Peter Williams Head of Industry Development at Aegon UK gave an interactive presentation.

We began with six questions testing the limits of our knowledge on the use of initial disclosure documents (IDD) and the Menu.....

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CIMIRF comes to HBOS in Leeds

Published: May 2005
By: Anthony Smith

We were very grateful to welcome Tim Pither and Chris Pask from the FSA to our latest CIMIRF meeting held on 17 May in Leeds, chaired by the North Regional Chairman Rod Hepple-Wilson and hosted and organised by Anthony Smith our South West Regional Chairman who gratefully acknowledges the assistance of his colleagues in Leeds for making the event possible.

Tim Pither began by outlining some of the work the FSA is involved with during the first few months of general insurance regulation.....

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Complaints: Are You Treating Your Customers Fairly?

Published: April 2005
By: Anthony Smith

We were pleased to be welcome by Travers Smith on Thursday 27 April to hear from Walther Merricks of the Financial Ombudsman Service, Jane Whittles Director, Governance and Control, IAM at Abbey and Margaret Chamberlain of Travers Smith.

Walter Merricks began by saying TCF impact of FOS is ‘not a lot’ but eventually maybe. FOS has to operate under the broad principles of the law, rules and industry practice. TCF is really directed towards senior management systems and controls.....

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Compliance Institute Mortgage and Insurance Regulatory Forum (CIMIRF) Bristol

Published: March 2005
By: Anthony Smith

We were pleased to welcome 3 FSA speakers at Deloitte in Bristol on 8 March. Our thanks go to our hosts who welcomed our South West Chairman Mark Ross from Ernst & Young.

Chris Paske who attended CIMIRF in Leeds last year went through what FSA had done in mortgage and general insurance regulation over the past year. The M & GI programmes followed a thematic approach choosing an important issue and investigating it across a sample of firms e.....

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Financial Promotions in the Midlands

Published: February 2005
By: Anthony Smith

Nick Jones, Manager, Communications and Strategy Financial Promotions Department FSA began with a presentation on what the FSA is trying to achieve through the financial promotions regime. Financial Promotions fit into the Retail Agenda and are integrated into the Treating Customers Fairly project aiming for firms to produce information that is clear, fair and no misleading with the emphasis here being on fair. There is an information gap between firms and consumers with some very complex products consumers do not understand.....

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CIMIRF at Canary Wharf 19 November

Published: November 2004
By: Anthony Smith

Despite the problems with the Jubilee line we arrived safely at Canary Wharf to begin with a presentation from Jonathan Fischel of the Retail Firms Division FSA. FSA are well on track with authorisations although there are a very large number of smaller firms authorisations are moving steadily upwards as they did with mortgage firms at NM. This has been a major task with around 75% of applications raising regulatory issues of which half were investigated and remedial action taken.....

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The South West welcomes CIMIRF at TLT

Published: September 2004
By: Anthony Smith

On Friday 10 September, thanks to the generosity of TLT solicitors, the South West Region welcomed the Compliance Institute’s Mortgage & Insurance Regulatory Forum (CIMIRF aka ‘smurf’) to its quarterly regional seminar where we also had in attendance Steve Williams Group Manager of FSA’s Retail Firms Division.

From April the FSA has been split into three business units covering Wholesale regulation, Retail regulation and Regulatory Services.....

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Training and Competence

Published: May 2004
By: Anthony Smith

On Friday 21 May the South West welcomed Sarah Thwaites from FSA to talk about ‘what T&C means for you’. The event was co-hosted with the Insurance Institute of Bristol. Mike Jones, Compliance Advice Manager from Axa gave the industry response relating his practical experiences with T&C and plans to implement the new regime for general insurance in Axa. Our thanks go to Axa for hosting the event in their magnificent auditorium, which was big enough to accommodate one of our largest audiences of around 80 people.....

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Compliance Institute comes to Cardiff - Financial Promotions

Published: March 2004
By: Anthony Smith

On a sunny afternoon in Cardiff we were very pleased to welcome Paul Jennings Senior Associate FSA Financial Promotions, Linda Bevin Technical Training Manager Legal & General and Anthony Smith Compliance Manager Clerical Medical. Although a departure from our regular venues in Bristol a large audience braved the journey across the Severn to take part in another lively and informative event organised by the South West Committee. Our thanks go to Legal & General for sponsoring the event.....

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Complaints Seminar South West Region

Published: May 2003
By: Anthony Smith

Our thanks go to Bristol & West for accommodating such a large crowd of around 90 people to the South West Region’s seminar on complaints handling with David Millington, Ombudsman Financial Ombudsman Service and Mark Smith of Zurich Financial Services. Another combined event with the Insurance Institute of Bristol organised by Paul Timmins. Paul’s profile and photo can be found on the South West regional pages of the member website as can the slides for this event under ‘Seminars’ by kind agreement of the speakers.....

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