8 | Regulation Matters - January 2019
FG18/5: Finalised Guidance on financial crime systems and controls: insider dealing and market manipulation (cont.)
WHAT SHOULD FIRMS DO NOW? Some firms will be subject to the new CRIM- REP Gabriel reporting requirement but most directly authorised firms will fall under the exemptions described in SUP16.23.2. However, the prevention of financial crime is a key focus of the FCA and even where you are not subject to the reporting requirement, the prevention of financial crime (i.e. money laundering, terrorist financing, fraud or dishonesty, handling the proceeds of crime and market misconduct) will be an area of accountability under the SM&CR. You should therefore: n Download the FCA guidance and latest JMLSG guidance n Review the systems and controls in the business to prevent exposure to financial crime n Review the financial crime training material you use within your business n Review the capability of any systems used for electronic verification of identity; and n Satisfy yourself that you have proportionate risk based systems to monitor existing client relationships and reflect this in your annual MLRO report (where this is a requirement) or self assessment. You may wish to consider the Money Laundering Officer’s Practical Handbook as an additional resource for your firm https://www.ctp.co.uk/ product/mlro-handbook/. We have a team of highly experienced Regulatory Consultants on hand to complete audits of your systems and control. If you feel you need support in this area please contact 0800 085 0825 for further information on the additional services available to directly authorised firms.
Your firm’s efforts to combat financial crime should also be subject to challenge. Senior management should ensure that policies and procedures are appropriate and are followed, e.g. having robust audit and compliance processes that routinely test the firm’s defences against specific financial crime threats. The FCA Handbook website reflects the updated FCG and FCTR. n https://www.fca.org.uk/publication/finalised- guidance/fg18-05.pdf n https://www.handbook.fca.org.uk/handbook/FCG/ n https://www.handbook.fca.org.uk/handbook/FCTR/ n http://www.jmlsg.org.uk/ We would particularly recommend firms review their practice with regard to ongoing updates of ‘Know Your Client’ information and how and when they check clients are not sanctioned individuals, or are subject to the rules on politically exposed persons, as this status can change from the point the business relationship started.
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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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