Regulation Matters January 2020


WHAT SHOULD FIRMS DO NOW? 1. Identify what changes are proposed to take effect within 1 week of implementation (see page 7 of CP 19/25) and consider whether the firm should make changes to disclosure documents, templates and/or processes in anticipation of the proposed changes. 2. Ensure that you understand the boundary between triage and advice and that you document cases deterred by triage (anonymising where appropriate, as per GDPR obligations). 3. Take appropriate action if DB advice is excluded from your PI policy or subject to an excess of more than £5,000. At TenetSelect we have a team of regulatory consultants and compliance specialists to support firms in meeting their regulatory requirements. Should you require further information on any of the additional services we can offer directly authorised firms please call us on 0800 085 0825 .

PI EXCLUSIONS Some firms are finding that their PI policy at renewal excludes cover for DB transfer advice or has an excess of more than £5,000. When this happens, firms need to ensure they have in place at least the increased level of capital resources required by the FCA’s rules (See IPRU-INV 13 ). They will also need to consider whether the minimum level specified in IPRU-INV is sufficient (‘appropriate’) in their particular circumstances, as per the requirement in the FSMA (Paragraph 2D of Schedule 6 ), Threshold Condition 2 in the FCA Handbook and FCA guidance in IPRU-INV 13 ( IPRU-INV 13.1.24 ). See also CP 19/20 re the FCA’s expectations in relation to financial resources. Firms with a PI exclusion (or increased excess level) who conclude that they have appropriate financial resources (at least the minimum specified in the Handbook) should also consider recent reported comments by Debbie Gupta. Ms Gupta is reported to have asserted that firms must stop providing new pension transfer advice and stop ‘pipeline business’ if DB advice is excluded at renewal or if an excess is very high. Ms Gupta’s comments were reported here: fca-clarifies-position-on-pi-for-advice/

DO YOU NEED FURTHER HELP OR SUPPORT? If you have concerns about being compliant, get in touch with TenetSelect, the directly authorised regulatory experts, by calling 0800 085 0825. We have a wide range of services to help your firm, and we would love to have a chat to tell you more. Regulation Matters is produced by TenetSelect as guidance only and is based on their interpretation, it is not and should not be relied upon as professional or legal advice. TenetSelect does not accept any liability for any losses arising directly or indirectly in connection with any of the information contained within Regulations Matters to the extent it can be excluded by law.

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