UK Newsletter | January 2023

6 February 2023 | UK & Europe | Publications

NEWSLETTER: Earlier this month, we presented a briefing looking at how investment firms are progressing with Consumer Duty.

Our own survey results concurred with concerns published by the FCA on 25th January, that some firms are still behind in implementation, and there is a risk they will not be ready in time. We anticipate this topic will dominate for some time to come and are, of course, here to help if you are struggling with the devil in the detail.

January also brought us the latest FCA “Dear CEO Letter”, this time targeting the wholesale broker community. As ever, this targeted approach means the warnings are to be taken seriously, and impacted firms must have action plans set and progress made against the points raised by 23rd February. The letter sets out the FCA’s view of the most important risks arising from wholesale brokers. These include underestimating liquidity risks and needs, the risks of hiring individuals who have been disciplined elsewhere, weak remuneration structures and sub-standard client onboarding processes to control financial crime and money laundering.

Last week also saw the close date for the FCA’s SDR Consultation Paper, which we responded to at the request of our clients. There remains uncertainty around how new rules will need to be implemented in practice, for example around determining how SDR aligns (or does not) with the EU’s SFDR for products distributed in the UK and across Europe. This remains one of the topics to stay ahead of, and if you have not already worked out how challenging the requirements will be to implement, don’t wait for the consultation conclusion stage to start planning.

Rebecca Thorpe
Chief Executive Officer