PIMFA BULLETIN
PIMFA WEEKLY NEWS BULLETIN
2 October 2023
PIMFA WealthTech partners with NayaOne to launch a Client Analytics & Profiling tech sprint
PIMFA WealthTech, launched in 2022 with principal strategic partner Morningstar, is the market network and technology platform that brings together the FinTech community and our wealth, investment, and advice sector.
This October - in collaboration with NayaOne, a leading technology company chosen by the Financial Conduct Authority (FCA) to operate their digital sandbox - PIMFA Wealthtech is running a tech sprint focused on showcasing how FinTechs can deliver improved Client Analytics and Profiling solutions.
The tech sprint will examine how financial advisers and wealth and investment managers can obtain and use structured, unstructured and alternative data about individuals to identify and secure potential clients and provide improved client support during pre-onboarding.
If you know a FinTech operating in this area, they are encouraged to register their interest to participate in the tech sprint at NayaOne here
Featured: PIMFA WealthTech partners with NayaOne to launch Client Analytics & Profiling tech sprint View in browserRegistrations are open now and will close on Friday, 6 October 2023, at 5 p.m.
PIMFA response to Digitisation Taskforce Interim Report
The Digitisation Taskforce, under Sir Douglas Flint, was established in July 2022, with the aim of driving forward the full digitisation of the UK shareholding framework by eliminating the use of paper share certificates and, in general, seeking to improve the UK's intermediated system of share ownership.
In July 2023, the Taskforce produced an interim report containing a set of potential recommendations for the Government, and seeking feedback on a number of key questions, in advance of the final report which will be delivered within six months.
PIMFA has discussed the report with its members, gathered their feedback, and submitted a response, which appears on our website here
In the response, PIMFA is broadly supportive of the work of the Digitisation Taskforce and its potential recommendations, but we have highlighted concerns about some of the proposed obligations on intermediaries. We have asked for a meeting with the Taskforce to explore its recommendations, and to understand its next steps.
PIMFA’s Response to the HMT Consultation on Banning Cold Calling for Consumer Financial Services and Products
On 2 August 2023, the Treasury published a consultation on banning cold calling for all consumer financial services and products, as announced in the Fraud Strategy in May 2023. This would extend the pension cold calling ban and aims to block fraud attempts before they can cause harm.
PIMFA provided an overall positive response while seeking clarity on how the ban will be articulated, in particular how client relationships are defined and how it would affect legitimate communications with existing clients. The full response is available here
As part of our representations to the government on your behalf, we consider that it may be useful to provide practical examples of how such a ban might inadvertently negatively impact on business, if such cases exist.
Should you have any practical examples or thoughts on the implications of such a ban, please contact MariaF@pimfa.co.uk
PIMFA response to HM Treasury’s Consultation on AML/CTF Supervisory Reform
In June, HM Treasury (HMT) consulted on reforming Anti-Money Laundering (AML)/ Combating the Financing of Terrorism (CTF) supervision in-line with a commitment in the Economic Crime Plan 2. Currently, the AML/CTF supervisory system is made up of three statutory supervisors - the Financial Conduct Authority (FCA), the Gambling Commission and HM Revenue & Customs - and 22 professional body supervisors (PBSs) who supervise the legal and accountancy sectors.
The high number of supervisors has led to inconsistencies in standards and approach and weaknesses in the supervisory system. HMT proposed four models for reform ranging from increasing the Office for Professional Body Anti-Money Launndering Supervision (OPBAS’s) powers and streamlining the supervisors to introducing a single supervisor across all sectors.
PIMFA has responded to the consultation supporting reform of the AML supervisory regime and advocating a reduction of supervisors, whilst maintaining the FCA’s role for financial services firms.
You can read PIMFA’s response here
The FCA and PRA Publish the Consultation Paper on Diversity and Inclusion
The FCA is consulting, alongside the Prudential Regulation Authority (PRA), on proposals to introduce a new regulatory framework on Diversity and Inclusion (D&I) in the financial sector.
CP 23/20 builds on the FCA/PRA Discussion Paper on D&I (DP21/2) published in 2021. The proposals support the FCA goals to achieve greater diversity and more inclusion, and improve outcomes for consumers and markets, by reducing groupthink, supporting healthy work cultures, unlocking diverse talent and improving understanding of and provision for diverse consumer needs.
The regulator sets out proposals to better integrate non-financial misconduct (NFM) considerations into staff fitness and propriety assessments, Conduct Rules and the suitability criteria for firms to operate in the financial sector (Threshold Conditions).
The FCA also proposes to require certain firms to report their average number of employees to the regulator on an annual basis, collect, report and disclose certain D&I data, establish, implement and maintain a D&I strategy, determine and set appropriate diversity targets, and recognise a lack of D&I as a non-financial risk.
The proposals would apply differently to firms depending on their number of employees, and whether they are dual-regulated. To reduce regulatory burden, smaller firms with fewer than 251 employees would be exempt from many of the requirements.
The deadline for response to this CP is 18 December 2023 and the FCA plans to bring the rules into force 12 months from publication of the Policy Statement. PIMFA will be responding to CP 23/20.
If you would like to get involved and provide your feedback to the proposals, please contact MajaE@pimfa.co.uk
FCA: Improving the Appointed Representatives (AR) Regime Through Greater Use of Data
The FCA has published data and analysis for improving the Appointed Representatives (AR) regime in line with their commitment set out in their Business Plan and Strategy.
The publication includes the analysis of data collected on the AR regime, how the collected data has improved the FCA’s understanding of the regime, its risks and benefits, how the data is informing greater scrutiny of authorisation applications and the FCA’s more assertive supervisory approach (including examples) and principals of the FCA’s enhanced expectations.
As part of the rules and guidance issued in December 2022, principals are now required to give the FCA more information about their AR. The FCA has set up a new AR department to lead cross-FCA strategy on ARs and high-risk casework. Moreover, the FCA has also supported HMT’s work to assess whether wider legislative changes are necessary.
FCA: Financial promotions for high-risk investments
The FCA has published the findings of their multi-firm review into how firms offering Restricted Mass Market Investments (RMMIs) have complied with new rules on the customer journey. The review explores 13 participating firms’ approach to each of the conditions set out in COBS 4.12A, including the incentives to invest, the cooling off period, the risk warnings, client categorisation and appropriateness.
The FCA expects all firms promoting RMMIs and nonmass market investments (NMMIs) to consider the findings of the review and make any necessary changes to their own practices. They also expect firms promoting relevant crypto-assets to UK based consumers to consider these findings due to the requirements set out in PS23/6: Financial Promotion Rules of Crypto-assets
According to the FCA, the strengthened rules aim to raise the overall standard of high-risk investment promotions and support the approach of the Consumer Duty. It would do so by encouraging firms to consider going beyond this minimum standard regarding the needs of their customers to deliver good outcomes.”
The publication can be found on the FCA’s website
PRESS RELEASES
PIMFA calls for clarity on cold calling ban and public awareness campaign
PIMFA WealthTech Partners with NayaOne to Launch Client Analytics & Profiling Tech Sprint
PIMFA delighted the Online Safety Bill has passed its final reading
Advice/Guidance review may lead to simpler advice services as part of a wholesale review, says FCA
FSCS Consumer Research: Attitudes Towards the Retirement of Tomorrow, September 2023
New research from the Financial Services Compensation Scheme (FSCS) highlights that retirement is among the top reasons to save for working age adults in the UK, but the majority have concerns about saving for it, with the main worry being not having enough money to last its duration.
Read the report here
PRESS COVERAGE
The Sunday Times: Life cover misselling rife, warns FCA
FT Adviser: No 'bonfire of regulations' post-Brexit, PIMFA says
IFA Magazine: PIMFA calls for clarity on cold calling ban & public awareness campaign
FinTech Alliance: PIMFA WealthTech partners with NayaOne to launch
READ MORE READ MORE
PIMFA D&I Awards
There are many instances of fantastic innovations and great practice which remain hidden or unrecognised in our industry and PIMFA is working to bring them to light to celebrate this work and importantly, to inspire and help drive positive change for a better future.
Join us on 12 October at the Intercontinental Park Lane, London to celebrate these wonderful achievements and hear the stories shared by changemakers across our industry.
Starting 3 October
PIMFA CASS Academy
The PIMFA CASS Clients Academy, powered by Ruleguard, is a unique learning experience for member firms who not only want to keep up with CASS requirements, but seek to expand their knowledge and strengthen their internal capabilities to arrest rising CASS audit fees and ensure the number of incidences and breaches reported to the FCA continues to drop.
The Academy will change the way you and your firm approach CASS. You will emerge better able to tackle your firms toughest CASS audit challenges, lead with greater CASS knowledge, and inspire assurance at all levels in your firm that your next CASS audit is a success.
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