i-law.com - Newsletter (Compliance Monitor)

Referrals to Enforcement

The FSA published the conclusions of the Enforcement Process Review, which was a response to criticisms of its approach in the Legal & General case (see Compliance Monitor February 2005) in July 2005. The Report contained over 40 recommended changes and focused on two areas - the way that cases are referred to the Enforcement Division, and the operation of the Regulatory Decisions Committee (RDC). Philip Ryley , solicitor, and John Virgo , barrister examine the process of referral to Enforcement.

Online Published Date: 01 December 2005

Appeared in issue: Vol 18 No 4 - 01 December 2005

cc: compliance comment

“We recruited a senior manager from the FSA about six months ago,” Michael Corrigan, a partner in Deloitte’s Financial Services Advisory Practice told delegates to the Securities and Investment Institute’s Compliance..

Online Published Date: 01 December 2005

Appeared in issue: Vol 18 No 4 - 01 December 2005

The FSA’s PPI Review: what it means for you

Earlier this year, the FSA carried out a review of the payment protection insurance (PPI) market to investigate firms’ compliance with the new general insurance mediation regime that came into force on 14 January 2005. The FSA has now published its findings, and has written a Dear CEO letter to firms to highlight “urgent action” its wishes firms to take to address non-compliant practices.

Online Published Date: 01 December 2005

Appeared in issue: Vol 18 No 4 - 01 December 2005

SREP Prep

Basel II, the long awaited and greatly delayed new capital framework for banks – EU implementation via the Capital Requirements Directive (CRD), also applicable to investment firms, is now set for 1 January 2007 – was supposed to..

Online Published Date: 01 December 2005

Appeared in issue: Vol 18 No 4 - 01 December 2005

The crisis in protection

The great British public is under-insured. Perhaps unsurprisingly, the insurance industry has been sending this message out for many years. As the first year of “full” general insurance regulation comes to a close, the message from the FSA seems to be that consumers have much to keep clear of, at least in the twilight zone of “personal” insurance that lies between mortgages, debt and other lifestyle protection. The regulator has already found serious problems with two of these products: critical illness and payment protection insurance. A broader review of the effectiveness of the regulatory regime is due next year. It has now issued a Dear CEO letter to firms complaining about the quality of policy summaries. In the meantime , Adam Samuel looks at what’s wrong with the sector.

Online Published Date: 01 December 2005

Appeared in issue: Vol 18 No 4 - 01 December 2005

Best execution: the MiFID effect

One of the most significant areas where the European Union’s MiFID Directive will impact on the Conduct of Business procedures of authorised firms is in relation to “best execution”, the obligation on firms to use appropriate endeavours to obtain the best available price for their clients when executing transactions in investments. MiFID will make some changes to the definition of what constitutes best execution, but more importantly, says Scott Cochrane , partner and Dominic Clarke , consultant, both of Herbert Smith, it will extend the categories of transactions and clients to which best execution obligations apply and add new procedural and client reporting obligations with respect to a firm’s best execution policy.

Online Published Date: 01 December 2005

Appeared in issue: Vol 18 No 4 - 01 December 2005

MiFID: not quite the end of the beginning

‘Start now or it may be too late’ was the consistent message to delegates to City and Financial’s “Preparing for the implementation of MiFID in the UK” conference on 30 November. Philip Warland of PricewaterhouseCoopers..

Online Published Date: 01 December 2005

Appeared in issue: Vol 18 No 4 - 01 December 2005

Lenders improve but brokers still poor in self-certification mortgage sector

The FSA is generally pleased with the progress that lenders have made in the way that they operate self-certification mortgage businesses since it issued its Good Practice Guide in February 2004. The regulator reviewed the practices of 10 lenders..

Online Published Date: 01 December 2005

Appeared in issue: Vol 18 No 4 - 01 December 2005

Transactions reporting breaches cost UBS £100,000 penalty

A July 2005 suspicious transaction report to SABRE – the FSA’s database of market trades – in which UBS’s wealth management division (UBSWM) wrongly recorded a purchase as a sale, led the firm to review its transaction..

Online Published Date: 01 December 2005

Appeared in issue: Vol 18 No 4 - 01 December 2005

General insurance perimeter in tact, FSA finds

In a review of 1,700 general insurance intermediaries – both primary, where sale of insurance is their main business, and secondary, when it is ancillary – the FSA found only two primary and 14 secondary firms that were deliberately..

Online Published Date: 01 December 2005

Appeared in issue: Vol 18 No 4 - 01 December 2005

Censure not £425,000 fine for Berkeley Independent Advisers systems and controls breaches

Inadequate monitoring of a strategy that recommended the sale of non-pension products as an alternative way to save for retirement and weak checks on suitability have led to public censure of Berkeley Independent Advisers Limited (BIA) by the..

Online Published Date: 01 December 2005

Appeared in issue: Vol 18 No 4 - 01 December 2005

Venture capital promotions need balance, says FSA

Retail theme work on web-based Venture Capital Trust (VCT) promotions issued by 11 intermediaries has exposed widespread shortcomings. The majority did not adequately explain how a VCT operates, some said nothing at all. Although the tax benefits..

Online Published Date: 01 December 2005

Appeared in issue: Vol 18 No 4 - 01 December 2005

Kings pays £60,000 financial promotions penalty

Non-compliant financial promotions and associated systems and controls failings have cost Kings, the Maidstone-based independent financial adviser, a £60,000 fine. The breaches, which occurred between 1 December 2001 and the end of February..

Online Published Date: 01 December 2005

Appeared in issue: Vol 18 No 4 - 01 December 2005

Payment protection insurance selling not good enough

In a sample of 30 firms offering payment protection insurance (PPI) with revolving credit (credit and store cards, and catalogues), unsecured loans and sub-prime mortgages and secured loans, studied by the FSA, around half that claimed to sell on a..

Online Published Date: 01 December 2005

Appeared in issue: Vol 18 No 4 - 01 December 2005

Bond broker and senior manager fined for money laundering breaches

Ram Melwani, managing director of Investment Services UK Ltd (ISUK) is the first approved person to be fined, in this case £30,000, for anti-money laundering failures. ISUK was penalised £175,000 for breaches of Principles 2 (skill, care..

Online Published Date: 01 December 2005

Appeared in issue: Vol 18 No 4 - 01 December 2005

In your own write

For the fifth year running Compliance Monitor and City recruitment specialists Joslin Rowe , have joined forces to canvass the views of compliance personnel on industry trends, the work of the FSA and the how they view their profession. This year..

Online Published Date: 01 December 2005

Appeared in issue: Vol 18 No 4 - 01 December 2005