PIMFA Weekly News Bulletin - 13 March 2023

PIMFA Responds to HM Treasury Consultation on PRIIPs and FCA’s Future UK Retail Disclosure Review

PIMFA has publicly responded to both the Treasury’s consultation on the repeal of the PRIIPs regime as well as the FCA’s Future Disclosure review.

We are supportive of the FCA’s wider review of the disclosure framework as well as HMT’s decision to repeal the PRIIPS regime. Given the high nature of the FCA’s discussion paper in particular, we consider that there is significant work to be done in order to deliver a disclosure framework which is fit for purpose. We have outlined a number of principles which we consider the FCA and government should take forward in its work going forward; namely:

1. Reduce the weight placed upon disclosure as a regulatory tool.

2. Reduce the range of assets subject to post-PRIIPs product regulation

3. Take advised business out of the post-PRIIPs product disclosure requirements

4. Develop ‘headline’ disclosures

5. Publish a coherent programme for reviewing retail disclosures

6. Create a central Retail Disclosure sourcebook in the Handbook

For further information, please contact Sarah McGuffick, or visit PIMFA sites for Public Affairs or PRIIPS.

Call for input: PIMFA seeks feedback from firms on impact of FSCS costs

We are seeking member views on the impact of the FSCS on their respective businesses. A link to the survey can be found here

This is the second iteration of PIMFA’s FSCS Survey to firms. Your input is crucial in providing PIMFA with an evidence base to make representations to government and the regulators regarding material impacts to your business. Whilst our previous survey focused on measuring the total cost of funding the FSCS (as well as associated PI costs) the purpose of this survey is to measure the material impact the cost of funding the FSCS has on your business. In doing so, we can make direct representations to HMT to support our campaign to find alternative sources of funding for the FSCS.

Our intention is to collate the responses from this survey into a short public report. As a result, your responses are both valued and any longer form answers which bring the impact of the levy on your business to light are welcomed.

For further information or to provide additional views, please contact Simon Harrington

Evidence gathering to update PIMFA Fraud Trends Guide

In 2021 we published our Fraud Trends Guide which sets out detailed examples of scams and frauds experienced by our member firms. As fraudsters are constantly developing new techniques and tactics and the scam landscape is subject to fast and continuous change, we would like to update our guide to include any new fraud typologies.

At this stage we are carrying out an evidencegathering exercise in order to collect as much information as we can on what current fraud and scams ‘look like’. We would therefore be very grateful if you could provide us with as much detail as possible on scams and frauds you have come across. This could be in the form of case studies, scenarios, screen shots of cloned websites or Instagram ads. Information relating to how a scam was detected and what factors raised any red flags would also be very useful.

We need your help and input in order to provide a good update to our guide and to ensure that it continues to be a useful tool in fraud prevention for our firms.

If you are able to help, please get in touch with Alexandra

Roberts

Economic Crime Levy

The Government has introduced an Economic Crime Levy (ECL) to fund the fight against economic crime (anti-money laundering).

The levy will be collected by HMRC, the FCA, and the Gambling Commission The levy will be paid annually and determined by a firm’s UK revenue. The levy will apply to AML regulated businesses (details in link). Impacted firms will see the new levy appear on invoices from July

2023 (those subject to the money laundering regulations between 6th April 2022 and 5th April 2023) Firms must submit their data via new Reg Report from 1st April to ensure they are charged the right amount.

FCA Authorises First LTAF

The FCA has announced that it has authorised the first Long Term Asset Fund (LTAF).

The LTAF is a new category of open-ended authorised fund designed to invest efficiently in longterm assets. The new regulatory regime for these funds came into force in 2021.

The FCA has worked with the Bank of England, the Treasury and industry, through the Productive Finance Working Group – to create an environment which support economic growth and the transition to a low carbon economy by enabling the ability to invest in illiquid assets, through appropriately designed and managed investment vehicles.

The FCA consulted on broadening access to LTAF in August 2022; final rules on this aspect are expected in H1/2023.

FOS Consults on Changes to Reporting BusinessSpecific

The Financial Ombudsman Service have published proposals which seek to amend the way in which the FOS reports business specific complaints data

In short, the FOS is proposing to create a separate category to their biannual business specific complaints data to record any complaint that is resolved by a fair and reasonable offer put forward by a business within 14 days of the FOS requesting the respondents business complaints file. Complaints settled in this way would be reported as ‘proactively settled’ and these outcomes would not contribute to a business’ overall ‘uphold rate’ and will be applicable to new complaints.

Complaints Data

We are of the view that these proposals are largely welcome but are seeking views from firms before submitting a response at the end of the week. Firms with views on the proposals should contact Simon Harrington

JMLSG: Updated guidance

The Joint Money Laundering Steering Group (JMLSG) has published final amendments in Part II of its Guidance:

• Sector 5 (wealth management)

• Sector 6 (financial advisers)

• Sector 11A (consumer credit providers)

• Sector 13 (private equity)

• Sector 22 (cryptoasset exchange providers and custodian wallet providers)

•

To highlight the Financial Ombudsman's ability to effectively handle complaints with a money laundering element, amendments have also been made to Part I Chapter 6 Paragraphs 6.706.71

JMLSG’s amendments have been submitted to HM Treasury for Ministerial approval.

Latest PIMFA Press Releases

PIMFA outlines six-point plan to reform disclosure requirements in wake of PRIIPs reforms

PIMFA welcomes FCA proposals for core investment advice but warns they risk being undermined by unnecessary restrictions

PIMFA calls for Financial Conduct Authority to have greater role in protecting public from fraud

PIMFA delighted to welcome Paul Stockton and Stuart Dodson to its Board of Directors

Consumer Duty a ‘watershed moment’ that firms must take seriously, FCA warns at PIMFA conference

Read more press releases here

PIMFA Press Coverage

Financial Times: ‘Cut stamp duty to boost UK stocks’

Finextra: Tech trends in wealth management for 2023

International Adviser: Pimfa calls on FCA to simplify post-Priips disclosure rules

FT Adviser: 'FCA should remove restrictions on its advice proposals'

Pensions Age: Industry organisations back calls for MPAA review ahead of Budget

See more of PIMFA in the press

27 April | 09:30 - 12:30

PIMFA FINANCIAL CRIME CONFERENCE LONDON

18 May | 10:00 - 18:00

Principles and practices your adviser population need to know and adopt.

This CPD Accredited and CISI Endorsed course takes you step by step through a framework your firm can adopt to improve your approach to client suitability, the critical component in your firm’s ability to meet the Duty’s two outcomes on customer support and consumer understanding.

For more information and to register, please click here

The PIMFA Financial Crime 2023 gives attendees access to industry leading debates from professionals across the regulatory, law enforcement, innovators and providers in the Financial Crime space.

For more information and to register, please click here

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