Four Weeks to Go

In July 2022, the FCA confirmed in its publications PS 22/9 and FG 22/5 its plans to bring in a new Consumer Duty, the object of which is intended to improve how companies serve consumers.

Whilst these rules do not need to be implemented until next year, this is just a gentle reminded to IFAs that have not yet started their internal discussions, that there are now less than four weeks until plans need to be finalised.

Policy Statement PS 22/9 sets out an expectation that: Boards or their equivalent should agree on implementation plans by 31st October, and maintain oversight of their delivery, to ensure the implementation work is sufficient to meet the required standards,

After this date, you can be requested by the FCA to share implementation plans, including, board papers, minutes and possibly will be challenged on their contents. I’m pretty sure that any request will as is usual include an extremely limited time period in which to comply.

Just to recap, in essence the rules aim to:

• Raise standards
• Reduce poor conduct
• Increase consumer confidence in advice

The FCA expects Consumer Duty principles to become embedded in a firm’s culture. The focus of regulation will become outcomes based. There are three overarching and cross-cutting rules

• Act in good faith towards retail customers
• Avoid foreseeable harm to retail customers
• Enable and support retail customers to pursue their financial objectives

As Sheldon Mills Executive Director at the FCA said in a speech last week “Consumers should come away satisfied and confident; their needs met and understanding the product or service they’ve got.”

Going forward, firms will need to demonstrate they understand what the client wants and needs, and the onus will be placed on the firm to conduct research and assess the evidence of what clients need. The emphasis is very much going to be on “Show us how you do that”
and providing evidence to back it up.

This implies much greater emphasis on data collection, management, and presentation for interrogation by the regulator.

None of these new rules needs to be difficult to implement, our consultancy service has always championed innovative ways to help IFAs, save time and effort.

We can help you with any aspect of the requirements without interfering with any existing arrangements, also none of our suggestions involve expensive changes to IT systems.

Our offer a of a free consultancy meeting is still available, as is our “Consumer Duty Framework” which we can provide for a fixed price fee.

To discuss your situation in confidence, please contact me  on our normal office telephone number or request a video meeting.