How does this regulatory plan for 2014/15 affect your firm? Wragge Lawrence Graham & Co's experts outline some of the key issues for which the asset management, wealth management/private banking sectors should prepare.
The Financial Conduct Authority's (FCA) Business Plan 2014/15 was published on 31 March 2014, together with its Risk Outlook 2014 report.
The FCA will be focusing on due diligence in suitability assessments, Retail Distribution Review (RDR) in practice, client money and custody rule changes, conflicts of interest within the wealth and asset management sectors, and market abuse controls within asset management firms.
Some of the key issues for the asset management, wealth management/private banking sectors to prepare for:
Click here to view table.
Regulatory challenges on a number of fronts should be expected by the wealth and asset management sectors.
Firms should review the FCA's 2014/15 Business Plan and Risk Outlook and:
- Make arrangements to consider upcoming regulatory changes and take them into account in relation to any future plans.
- Consider whether any changes to the firm's business model and strategy will be needed. Be prepared to demonstrate to the FCA (should it ask) that the firm has kept abreast of the regulatory changes and amended its model and strategy to accommodate new standards.
- Take into account the 'culture equation' when assessing potential regulatory risks that may be associated with the firm's services or activities. The FCA wants to see individual accountability and a responsible culture.
- Test the robustness of their market abuse controls.
Wealth and asset managers should build in time to assess global regulatory developments. More time and resource will be required to cope with the impact of EU and UK changes. All firms should review the current EU initiatives set out within the FCA's Business Plan which may impact them this year or into 2015/16 and ensure these developments are monitored.