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FCA launches three consultations in extension of senior managers’ regime

  • 13/12/2017
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FCA launches three consultations in extension of senior managers’ regime
Industry watchdog, the Financial Conduct Authority (FCA) has published three consultation papers intended to help firms and individuals transition to the Senior Managers and Certification Regime.

Post-credit crunch, the regulation is a bid to inject personal responsibility and accountability into financial services culture and processes. All responses are due by 21 February 2018 with final policy due out in the summer.

The regulator is also tailoring processes to accommodate differences in firm size and ease the way for Approved Persons to automatically convert to the new regime with no paperwork or applications.

The regulator has already consulted on the extension of the regime to “almost all regulated firms.”

The FCA said: “Firms can instead focus on embedding the cultural changes that the new regime introduces and making sure their staff know what they need to do.”


Duty of responsibility

The FCA is also consulting on extending the Duty of Responsibility to insurers and firms solely regulated by the FCA, as it only applies to senior managers of banks at the moment.

Under the duty of responsibility, senior managers are accountable for the business areas they lead and can be penalised if the regulator can show the senior manager did not take reasonable steps to avoid the breach occurring or continuing.

Jonathan Davidson, executive director of supervision – retail and authorisations at the FCA, said: “This next set of our proposals outline our plans for a smooth transition to the new regime, which is simple, clear and proportionate. Indeed, the vast majority of firms will not need to submit applications to convert existing approved persons to senior managers.”

In response to feedback, the FCA is also considering what the move to the new regime means for the Financial Service Register.

See all the consultation papers here:

1. CP17/40: Individual accountability: Transitioning FCA firms and individuals to the Senior Managers and Certification Regime
2. CP17/41: Individual accountability: Transitioning insurers and individuals to the Senior Managers and Certification Regime
3. CP17/42: The Duty of Responsibility for insurers and FCA solo-regulated firms

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