Has your firm been instructed to carry out an FCA S166 Review?
Do you require support through an S166 review that you are undergoing?
Enterprise Learning has recently been put onto the FCA Panel of 20 companies for FCA Skilled Persons S166 Reviews in Conduct of Business. We are able to carry out S166 reviews or support and advise firms who are subject to a review.
Is your firm required to undergo an FCA Skilled Persons S166 Review?
These reviews can be complex and need to be handled carefully with a highly detailed investigation and thorough implementation programme. Managing a review badly can lead to poor relationships with the regulator, high levels of customer compensation, management and business disruption and unnecessary expenditure on advisers, lawyers, consultants and Skilled Persons.
Below we have compiled a helpful list of key tips if your firm is undergoing an FCA Skilled Persons S166 Review.
What can you expect from us in carrying out a Skilled Persons review?
- The same work ethic, standards and capabilities as any large consultancy or accountancy firm.
- The personal approach of a smaller firm
- Over 15 years’ experience supporting companies through S166 reviews, with deep understanding of how they work, FCA expectations and cost-efficient approaches to achieving the FCA requirements.
- Focused approach – we will stick to the scope of the FCA requirements notice and not try to expand it or look for fruther work that may not be needed.
- Experienced, expert technical specialists who understand insurance, banking, investments, mortgages and lending
- The ability to resource large, complex projects with industry recognised specialists and manage your review within budgets and on time.
For more detailed information on how we can help with FCA Skilled Persons S166 Reviews, don’t hesitate to get in touch.
Key Tips for Undergoing S166 Reviews
1. Ensure the Top Team are Fully Engaged.
All of your top management team must be fully aligned and ready to invest time in delivering what is necessary to achieve the end goal for your team. It is important to see this as an opportunity for improvement. The Board must be involved and fully commit.
2. Scope Accurately.
Scoping the review at the beginning is essential so that potential cost and activity is understood from the outset. The regulator will issue a Requirements Notice setting out their view of the scope and this needs to be thoroughly reviewed and discussed with them. If you can achieve the same outcomes in a different way, they may be open to considering this. Regulators do not want to cause unnessary cost to your business which may harm customer interests, however they are unlikely to respond to emotional or unsubstantiated arguments not based on the detail of their requirements.
3. Agree Roles and Responsibilities
Convene a tri-partite meeting early in the process to agree the respective roles/responsibilities of everyone involved. There will be key staff involved from your organisation, as well as the FCA and the Skilled Person and their organisation. Agree protocols for communicating, regular reviews, sharing findings and recommendations. If all this can be agreed up-front, there is less risk of mis-aligned expectations and disagreements later on.
4. Establish a Formal Programme to Manage the s166
Establish a programme to ensure the s166 is managed effectively and within the agreed budget and timescales. Find a Programme Manager with experience of managing S166 or rectification programmes as they are unique and challenging. Establish a Steering Group to meet regularly and discuss reports on progress. Invite the Skilled Person to present at the Steering Group to update you on how their work is going. Raise any issues/risks with the Skilled Person and with the FCA as they arise so they can be solved.
5. Focus on Customer Outcomes
Regulators prioritise Customer Outcomes and it is important you should show you are on the same page. Arguing over process problems or systems issues will cut no ice. However, if you can suggest more effective, quicker and less expensive ways of compensation or rectification the Skilled Person and the FCA will probably listen.
6. Recognise how the Skilled Person works
The Skilled Person is independent and, although their fees are usually paid by you, this is not a typical client-consultant relationship. They do not represent you or the regulator. They are required to fulfil their regulatory duties and should be treated accordingly. Provide confidential and secure space for them to work, respect their confidentiality, do not pressurise them for early findings and ensure staff are encouraged to help them.
7. Manage information and communications
Ensure all information provided to the FCA or Skilled Person team is checked thoroughly and is complete. While your people should be helpful, everything provided should be done so via your Programme team. The Programme team should record everything that is provided and keep a written record of all meetings and correspondence.
8. Engage your own advisers and consultants
While it may be tempting to tackle everything yourself using your Compliance and Legal teams and your Executive Team, they also have their day-jobs to do and may not have experience of these challenging programmes. Engage your own advisers or consultants – they can help you in your negotiations with regulators, challenge your thinking and help you present plans and proposals in a way that will be compelling and successful. They should have experienced staff who can supplement your Programme team.
9. Build relationships, don’t damage them
S166 reviews can be emotionally challenging for senior executives. Their work may be being questioned by the regulators or Skilled Persons, they may be personally worried about their career and they may be struggling under the additional workload created by a S166 review. Talk regularly as an Executive Team, support each other and be sensitive to re-allocating tasks and responsibilities if this is needed. Strong management teams manage s166 reviews better than fractured or divided ones.
10. Build FCA confidence in your management team
Even if your customers have had poor outcomes and compensation and rectification is needed, you can build FCA confidence that your business and your management team a can tackle these effectively. This can be done through realistic plans, meeting deadlines set by the regulator and communicating frequently. Showing regulators your plans, demonstrating executive understanding of regulation, showing how your business is strengthening and how your focus is on customer outcomes can all ensure that enforcement and fines do not result from a S166 programme.