The reality of The Certification Regime


Close your eyes then open them. Anything different? The reality is that despite you doing this the forthcoming requirements of the Certification Regime have not gone away.

It’s only at the consultation stage at the moment and it might all change.  Besides the formal rules will not be issued until 2018. There are plenty more other things to be getting on with – MiFID II and the Insurance Distribution Directive to name but two.

Interesting point of view – there are a few points to consider here

We know that consultation papers represent the results of a large amount of work undertaken by the regulator and as a rule of thumb 80% of what is included is likely to go ahead, as is.

So not only are the regulators consulting they are basing the changes on real life experience.

We also know that the requirements of the Certification Regime reflect the one that has been operating within the banks and building societies (and other relevant authorised persons) since 2016. So not only are the regulators consulting they are basing the changes on real life experience.

Finally we know that HMT has indicated that the regime will be extended during 2018 – we don’t know when exactly but we may not all have the luxury of a long period of time to make the changes.

Certification is all about FITness which itself embraces a person’s competence and capabilities. Forgive me but as I understand it both MiFID II and the IDD contain requirements on knowledge and competence.  Surely it makes sense to try and work in anticipation of these changes.  If not I do hope you find the inside of your silo comfortable.

We then have the issue of T&C.  You may feel that all is in order and that there is nothing more for you to do.  Perhaps not?

The categories of significant harm functions (SHFs) embrace people operating in different aspects of your business.  As such some, such as advisers, may be used to operating subject to the detailed requirements of the TC sourcebook. Others, such as former SIFS will be governed by SYSC rules relating to the competence of senior management with the balance of SHFs being governed by the competent employees rule.  Perhaps there is an opportunity to review the approaches taken with special emphasis on how your approaches deliver a consumer outcome focused approach. In other words how your approaches support your culture, values and of course the new code of conduct.

It seems to me that you should be taking stock now of what exactly you are being asked to do.  Look in detail at the requirements and work out where you may have gaps and the actions you might need to take.  Starting now would be advisable to ensure you have the maximum amount of time.

I would of course advocate attending one of our workshops

but in true BBC independence mention that there are other alternative available in the market place,

Feeling confident that you will cope? Then read our Dear SMF letter and just imagine your reaction if this were for real


About Author

The consequences of interpreting regulation incorrectly; designing policies, processes and procedures poorly; weak training or inadequate supervision can lead to poor consumer outcomes, no return on investment or possible regulatory intervention. I provide services and support for people aspects of regulation and people development for UK based financial services companies. My clients include banks, building societies, product providers, networks and other larger financial services companies. My specialities include: Regulated Training & Competence T&C Health Checks and Audits Competency frameworks and schemes Conduct Risk, culture and TCF Leadership, management and supervisor development Coaching Competence assessments Development of T&C Capability in Firms Certification & Code of Conduct Health Checks Consultancy and support in connection with any of the above elements.

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