No Escaping Accountability For City Chiefs As UK Widens Net
The weight of individual accountability will soon cover the entire British financial landscape after authorities revealed plans Wednesday to expand the management conduct regime to all 56,000 firms under their watch, prompting attorneys to warn of a new era of enhanced compliance.
The Senior Managers and Certification Regime, or SMCR, a code of conduct that puts accountability for failings squarely on the head of designated staff, is currently applicable to only the largest names in banking and insurance.
But the Financial Conduct Authority, Britain’s financial watchdog, and bank and insurance regulator the Prudential Regulation Authority on Wednesday announced the regime will expand in 2018 to cover all firms, large and small, including asset managers and financial advisers.
Claire Cross, Of Counsel at Corker Binning, commented:
“Today’s news was an inevitable result of the FCA’s drive for individual accountability across the board.
Running two separate regimes for individuals (the Senior Managers & Certification Regime and the Approved Persons Regime) was not a sustainable approach for the FCA to take.
Whilst the FCA has stated that the regime will be ‘proportionate,’ small firms will undoubtedly be concerned by the new burdens that the SMCR will lay at their door. Anyone who is worried about the effect of the extension should take time to read the Consultation Paper and consider responding to the questions posed.”
Read the full article in Law360 here, behind a paywall.