The FCA’s warning last week (Nov 3), that a lack of Appointed Representative (AR) oversight is putting customers at risk of financial harm, is not the last word on this subject.
This is the third time the FCA has commented on AR oversight during the last year and it is only a matter of time before stricter penalties are imposed. That will surely lead to regulatory action being taken against those firms not satisfying the FCA’s requirements.
What you need to do
AR oversight is complex, constant and needs to be evidenced. Principal firms carry the risk and need to:
- set key performance indicators and review against them on a regular basis
- demonstrate robust compliance monitoring to ensure that the advice given to customers, and the products sold, are sound and appropriate
- make sure that adequate professional indemnity insurance cover is in place
- monitor ARs on a regular basis to make sure they remain competent and financially stable
Managing and monitoring ARs is a time-consuming administrative burden. However, failure to meet all of these criteria exposes principal firms to unnecessary risk.
The TrackMyRisks solution for Appointed Representative oversight
The TrackMyRisks software platform can automate much of this repetitive monitoring for your business. It:
- helps you identify the business critical processes and risks that your organisation faces
- allows you to store and share documentation and receive automatic alerts when documents or policies need to be reviewed or updated
- keeps a full audit trail so you can evidence your good governance to third parties such as the FCA
- produces management information to help you identify trends and manage network risks
- is flexible and inexpensive, growing with the need as your AR network expands