The Financial Conduct Authority is set to send an increasing number of letters to firms’ senior management asking them to attest their firm is compliant with its rules.
The regulator says it is focusing on individuals as this brings greater personal responsibility to supervision and can keep firms on their toes between formal visits.
Attestations can take the form of Dear CEO letters to a whole sector or to an individual within a single firm. An FCA spokesman says: “Attestations evolved from our greater emphasis on personal accountability. We find that when we ask for them, it focuses the mind not only of individuals but also of the firm.”
Telos Solutions director Richard Farr says: “There will be a rise in attestations because they are cheap and effective and the FCA can target a specific firm about a specific issue.”
Farr says any attestation should spark an internal review of the business before offering assurances to the regulator.
Bovill head of projects Rebecca Thorpe says: “Supervisors will be encouraged to gather data from many sources and will need to be smarter about how they use it.”
Jacksons Wealth Management managing director Pete Matthew says: “Good firms will welcome this move. I do not think it is too intrusive; it is a good way of monitoring compliance between formal visits.”