Following a consultation period, in July of this year, the FCA issued the Consumer Duty Paper. This paper sets out rules that put consumers at the heart of our businesses and focus on delivering good customer outcomes. Implementation is by July 2023
In addition to this, the AR paper was issued by the FCA in August. This paper sets out required improvements to the Appointed Regime, including the onboarding and monitoring of Appointed Representatives by the Principle network with implementation from the 8th of December.
The FCA has recently been very vocal, confirming that in the last 12 months, 1 in 5 authorisation applications have been declined, up from 1 in 14. Emily Shepperd, the FCA’s chief operating officer and executive director of authorisations, said: “We have increased scrutiny, now conducting a complete review of firms’ business plans, risks, budgets, resources, systems, controls and whether key staff have the necessary qualifications and experience to act effectively.”
For all Networks, the new rules from the AR paper will mean some changes in monitoring standards and requirements, including the need to gather more data about our member’s businesses. This data gathering will include the business you do with Connect and the businesses and income you have elsewhere, both financial and non-financial.
We are working through the requirements and will communicate more information in due course. We know at this stage that a minor update to the contracts will be required and the completion of a data questionnaire, which will be sent to controllers towards the end of the year.
We are also working hard to make sure that we improve how we communicate the network and Regulatory requirements so that you have a clear understanding of what is required to keep your business compliant and yourself and your customers safe. We recently communicated more clarity on the adviser status for file checks and we are in the process of reorganising BOX and the operations manual to help you find what you need more quickly.
Recognising the increasing standards required by the FCA, we have written some guidance to clarify what constitutes a breach for all advisers. The FCA have a set of conduct rules that it requires all authorised advisers to adhere to.
You can find more information and the breach guidance here: https://connectifa.box.com/s/rti0q4nh7l9ihwuuwrrnl3e0e1t1wsxg
I am pleased to confirm that we have increased our membership with the trade body AMI (Association of Mortgage Intermediaries) so that now all regulated advisers have their own individual membership. In the coming days, you will receive an email from AMI with a membership number and login to their portal. The portal has a wealth of information to keep you updated in the mortgage market and is particularly useful for AR paper and Consumer Duty updates as they evolve. As with the membership of the specialist trade body FIBA, this is a completely free resource for our members.
Don’t forget our Training and Member support team are on hand to help you with any system, process and general compliance queries.
For further information on this or for other queries, please contact membersuppport@connectmortgages.co.uk