The FCA purposefully wrote existing guidance so that it is flexible and non-prescriptive, takes account of all relevant circumstances and recognises that what is reasonable is context-specific and will vary according to the facts of each individual case.

The guidance already provides, in DEPP 6.2.9-E(8) to (12), (14),(15) & (18), a lengthy and expressly non-exhaustive list of considerations the FCA will take into account in assessing whether a Senior Manager’s actions were reasonable in all the circumstances.

In addition to the points already noted above, that list includes factors the FCA believe relevant to, for example, delegation, the establishment of reporting lines, staff appraisal processes, role transition handovers, risk identification, expansions and restructurings, external professional advice, transaction monitoring and collective decision-making.

Good

Based on 49 reviews

Gerry Neu

2023-06-15

Lee, in particular, but the whole team has excellent FCA experience and provide the context for solid advice. What stands out, especially, is the practical approach and the understanding of compliance within a commercial environment. Much appreciated assistance in an FCA application, but also policies and procedures and MLRO activity.

SRUTI SOURAV SARANGI

2023-02-21

Compliance Consultant had imparted two days intense training on key compliance subjects . With highly experienced trainer, excellent content and captivating sessions they delivered the best to our team. We are thankful to Compliance Consultant for their services.

Simon Dhillon

2022-08-23

I worked with Compliance Consultant for 2 years and was involved in a variety of projects for various firms, both start-ups and established. Lee was a pleasure to work with and was very knowledgeable about all aspects of compliance, this provided reassurance that client work was carried out to a high standard. The team at Compliance Consultant worked very closely and was always on hand to provide assistance or advice on specialist areas for eg FCA Authorisations or Audits.

SMTAKS

2022-08-15

In a high pressure situation, Compliance Consultant stepped in to help us further understand the requirements and completely changed the authorization documentation urgently needed.

Angela Young

2022-01-27

First class service in every way. Whilst applying for FCA authorisation the original compliance company we were working with let us down. Feeling despondent, Lee from Compliance Consultant stepped in and assured us we would have our application submitted on time. Suzanna was our direct contact and she worked tirelessly to ensure we met our deadline. Not only did we meet our deadline, but our completed application was submitted to the FCA, 1 week ahead of schedule. Both Lee and Suzanna took the time to communicate clearly the detail within each section of the application. They went above and beyond and felt more like friends by the end of the process. I would highly recommend Compliance Consultant both in terms of professionalism and value for money. We look forward to working with Compliance Consultant in the future.

Grant Townshend

2022-01-10

We approached Lee between Christmas & New Year about some compliance work we urgently needed completing for a newco setup. He communicated very clearly what we would need and why. Once instructed, he delivered this on time and cost effectively. Recommended.

Mohamed Yassin

2021-10-28

Outstanding job on every level. We are very pleased with their work. Done on time, done on budget and they know what they are doing. They handled everything with extreme professionalism and delivered our project in a timely manner. We couldn't be happier with the end outcomes, Lee and his team were extremely thorough, understanding and responsive throughout each stage of our contract. We look forward to working with them in the future on our project. Thank you, Lee and Compliance Consultant team.

The Duty of Responsibility will apply to a wide variety of situations, firms and Senior Manager roles within those firms. The FCA do not believe that they can go further and specify the detail of reasonable steps by Senior Managers in different roles in each of those situations within different types of firms.

Evidencing compliance and administrative burden
The Duty of Responsibility imposes no additional obligation on a Senior Manager to explain or justify to us relevant steps they took and/or did not take, nor to keep records supporting such an explanation or justification.

As The FCA explained in CP17/42, as noted above and as The FCA’s existing relevant guidance in DEPP states, the burden of proof, in enforcing the Duty of Responsibility, lies on the FCA. The FCA will need to show that the relevant Senior Manager did not take the steps a person in their position could reasonably have been expected to take to avoid their firm’s relevant misconduct occurring or continuing.

“It may, however, be in the interests of a Senior Manager to keep records of relevant steps they take, in case questions are raised, whether by their firm, its lawyers, auditors, insurers or customers, the FCA or another regulator. The FCA do not believe it is necessary to make that general point in The FCA’s DEPP guidance on the Duty of Responsibility.” – FCA PS18/16 P9

 

Such records might be relevant not only to compliance with the Duty of Responsibility but also with The FCA’s Code of Conduct for Staff Sourcebook (COCON). COCON is part of the SM&CR and requires all Senior Managers, and many other staff of firms subject to the SM&CR, to act with due skill, care and diligence.

Further, any relevant FCA investigation is likely to take into account that each Senior Manager is also under a COCON obligation to take reasonable steps to make sure that the business of the firm for which they are responsible complies with the firm’s record-keeping obligations imposed by the FCA’s Handbook.

The FCA’s Handbook requires each firm to keep records allowing the FCA to monitor the firm’s compliance. This includes compliance with its obligations under the FCA’s Principles for Businesses to conduct its business with due skill, care and diligence and take reasonable care to organise and control its affairs responsibly and effectively.

For the avoidance of doubt, those COCON obligations will not, when the SM&CR is extended, be new to those individuals currently carrying out roles, at insurers and FCA solo-regulated firms, that will need, under the SM&CR, to be filled by Senior Managers.

All of those individuals are currently holders of Significant Influence Functions (SIFs) under The FCA’s Statements of Principle and Code of Practice for Approved Persons, which already require SIF holders to take such reasonable steps and act with due skill, care and diligence.

A Senior Manager’s or SIF holder’s failure to take reasonable steps in relation to that record-keeping by their business, which includes record keeping in relation to their management of that business, may, quite apart from the Duty of Responsibility, amount to misconduct for which the FCA will take disciplinary action.