Compliance tip: Remove the gap in your approach to vulnerable clients

The issue of how firms treat vulnerable clients is not a new area of focus for the FCA but the regulatory scrutiny shows no sign of abating, with concerns forming a common thread throughout its 2018/19 Business Plan.

Many firms are still struggling to ensure that vulnerable clients are identified and supported throughout the customer journey. Here are the three most common gaps in their approach.

  • Culture: A firm’s culture ultimately drives every client interaction. A client-centric culture is fundamental to delivering the right outcomes and all employees, not just senior management, should be aware of their role in this.
  • Policy and processes: Many firms have a high-level vulnerable client policy in place; however, this is often not supported by procedures and controls to ensure that the policy results in fair outcomes on the frontline. Policy and process gaps often lead to inconsistencies in the way firms manage their vulnerable clients, which increases the risk of sub-optimal outcomes.
  • Disclosure: The earlier a client’s vulnerability is disclosed, the sooner firms are able to manage their journey effectively. But many firms struggle to manage the initial disclosure appropriately. Often, frontline staff do not feel adequately informed or empowered to have these conversations with clients, leading to information not being recorded or a poor client experience.

Phil Deeks is technical director at TCC


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The FCA’s recent discussion paper, DP18/2: Transforming Culture in Financial Services, focused heavily on how to drive cultural change within an organisation. A number of the paper’s contributors highlight that focusing solely on senior management behaviour and the ‘tone from the top’ overlooks the complexity of organisational culture and the role all employees have in […]


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