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Apfa calls on FCA to drop Mifid II call recording rules


Apfa is urging the FCA not to “gold-plate” the telephone recording requirements in Mifid II because the measure is disproportionate for the adviser market.

Apfa was responding to the FCA’s third Mifid II consultation paper, published in September, which included the suggestion to extend the recording requirement to all “Article 3” firms, which includes financial advice firms and corporate finance boutiques.

Under Mifid II firms are required to record telephone conversations and electronic communications that relate to “the reception, transmission and execution of orders, or dealing on own account” and keep them for five years.

In a statement, Apfa says the current suitability report requirement ensures there is an unambiguous record of what is recommended to clients.

Apfa director general Chris Hannant says: “The taping measures are intended to combat market abuse and make sense in the context of trading conditions, where timing is crucial to the outcome and you need to know who said what and when. The proposals are disproportionate in an advisory context.”

Hannant says: “The FCA has adopted a minimalist approach to implementation for the rest of Mifid II – this is sensible and proportionate. I don’t understand why they want to alter this policy in respect of recording calls for article three exempt firms.”

Apfa says it believes the call recording requirement will be particularly costly for small firms.

Its consultation response reads: “These costs would inevitably be passed on to consumers, running counter to the objectives set out in FAMR of making financial advice more accessible to the mass market. For these reasons we believe it would be disproportionate to require firms to record their calls and electronic communications.”

Speaking at the time the consultation paper was published, FCA policy, strategy and competition director David Geale said the requirement to record calls would not place an undue burden on IFAs.

He said: “We believe that the taping of telephone calls need not be onerous or expensive. Technology exists to enable advisers to record and store calls easily and affordably, we therefore believe it is proportionate to require firms to tape calls.” 



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There are 7 comments at the moment, we would love to hear your opinion too.

  1. So if I understand this correctly, this directive relates to instructions by telephone and not to direct client meetings. Is this move therefore directly aimed at transaction and execution only dealers?
    Just don’t see how it can affect a lot of adviser firms as most tend to carry out face to face interviews and these are not mandated to be recorded (or am I totally wrong here?).

  2. Nicholas Pleasure 5th January 2017 at 5:44 pm

    Another case of the small advice firm being treated like a big bank. Whilst the technology exists to do this, for it to have any value would mean that all meetings would also need recording. That may be difficult when trying to establish trust with a new client. Why can’t the FCA just allow us to run our own businesses and take the steps that we believe are necessary to protect ourselves and our clients? This will be right for some firms but not for others. Why do they feel it necessary to micromanage us?

  3. Will this also extend to one-off mobile phone calls?

  4. robert milligan 6th January 2017 at 3:58 pm

    Just ordered Call Recording with BT its only £6.25 p/month p/line!!

    • Is this just for landline calls? The big issue is that a large amount of calls from clients are quick questions to my mobile usually when driving. They are handled quickly and efficiently on my hands free kit and the client kept happy and informed. Imagine if I had to then arrange recording – I’d have to arrange to ring them back, taking more time out of my day and thus reducing the no of serviceable clients I can handle. Ridiculous with almost no tangible benefits and stacks of disadvantages to the client and adviser, incl a deterioration of steady relationships.

  5. How’s this even an issue now? Hasn’t the industry seen what new tech is available, and how cheap it is? You can even use one call recording app (Dubber) to record face-to-face meetings as well as telephone calls. And they offer unlimited storage in the cloud for years (10+). All for around 10 quid/month. Too easy!

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