Brokers urged to review compliance in light of fines

Brokers are being urged to heed the FSA’s recent enforcement actions and ensure they meet regulatory requirements.

Despite numerous actions and warning by the FSA in recent months, compliance specialist MS2M says many advisers are still failing to ensure they have good record keeping.

In recent weeks, four advisers have been banned, while many more have been fined, including a huge £900,000 fine for Thinc Group for failing to document sub-prime cases properly.

Julie Alderson, director of MS2M, comments: “Given the FSA’s stance, it’s a great opportunity for responsible advisers to go back to basics in terms of the management of their firms and to revisit their core practices.

“The risks are too high to ignore putting fundamental systems and processes in place.”

Margaret Cole, director of enforcement at the FSA, has already warned the regulator will pursue personal fines against individuals managing firms that fail to implement proper controls, and recent fines have been made for this reason.

Alderson says expensive consultancy fees or monthly retainers are not the only way to ensure a firm is meeting its compliance requirements. She says compliance health checks can cost a few hundred pounds and will indicate where firms are achieving compliance and where they are failing, so suitable action can be taken to keep the regulator at bay.

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