I am pleased to introduce everyone to Alan Baldwin, who has joined Connect as our new Director of Compliance. Alan has many years of experience in compliance, holding senior positions at both lenders and brokerages and is an excellent addition to the Connect leadership team at a time when compliance matters have never been higher on the agenda.
As alluded to in my previous emails, the FCA has now issued the Section 165 notice to all Networks requesting the AR financial data and in turn, more information will be shared shortly in relation to the additional data we will require from all our AR firms to meet the FCA requirements.
In the meantime, Alan would like to share the following update with you:
Regards
Liz Syms, CEO
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We have recently seen a trend from lenders to enhance and increase their audit requirements. You may have already noticed an increase in requests from lenders for you to send them client files, this will be, in part, due to the FCA’s recent enhancement on the Appointed Representative (AR) requirements for firms. Meaning, they are now required, as we are, to enhance the oversight and controls when it comes to ARs. If anyone would like to read the updated requirements, you can here: https://www.fca.org.uk/firms/appointed-representatives-principals, alternatively please feel free to contact Liz, Kevin or me if you would like to have a conversation on this matter and what changes are likely to take place.
To ensure we provide as much support as possible if you receive a request from a lender for a copy of your client file, post-completion, please ask the Compliance team to review the case before you submit the data. We will then review the case and ensure everything is in place before the file is sent to the lender.
This goes towards our objective of trying to increase the use of our Compliance team as a support function for all of our advisers. Therefore, I would like to remind everyone that if you have any questions on cases or anything at all, please call the Compliance team, who will be happy to help.
Another trend we have seen in the market since the release of the updated AR requirements is that lenders appear to be taking a zero-tolerance approach to anything that doesn’t look right. This has resulted in an increase of ARs being removed from their panel, with little or no warning.
Previously lenders would have called the firm to discuss the case and give them a chance to explain, However, this no longer appears to be the case. A panel removal can be devastating to your business, so again, I would like to offer Compliance as support should you have any queries.
As panel removals are often off the back of issues identified with submitted applications, these are a few things you can do to protect yourself from potential lender panel removal:
- Ensure the case is fully packaged (as is all the correct documentation) before you submit the application.
- Use the file check tab on OMS to verify and check the documentation for accuracy or issues.
- Leave notes to explain anything that the lender may query, and add these notes to the application when it is submitted (Or provide them to the Connect case manager to add for you).
- Speak to BDMs or underwriters before you submit applications to explain unusual cases, and add notes to the application confirming the conversation and the date and name of the person you spoke to.
- Flag anything you are uncertain about to the Compliance team who will help you to evaluate.
For further queries, please contact myself or the compliance team.
Regards
Alan Baldwin