WMA Bulletin 9th February 2016
Need to Know What's happened in our industry? Settlement Discipline under CSD Regulation On 1st February ESMA published draft regulatory technical standards (RTS) on settlement discipline. The EU Commission has 3 months to endorse the RTS which will then take effect 2 years after their publication in the EU Official Journal, expected to be in mid-2018 and a year after the main provisions of the CSD Regulation are expected to come into force. WMA will provide a summary in the next
Transfers and Re-registrations On 3rd February FCA hosted a meeting of trade associations and others including WMA and UK Platforms Group on the issue of timescales relating to client transfers and re-registrations. This followed up a Peer Group Business Model and Sector Analysis on selected Platform Service Providers and SIPP Operators that the FCA undertook in 2015. WMA will be involved in further work on this, for additional information please contact Andy Thompson.
WMA Update on the settlement discipline requirements along with the other main
Requests from Aegon Ireland
areas of the CSD Regulation that will
We are aware that some firms are receiving
impact WMA member firms.
requests from Aegon Ireland where the firm has a number of segregated accounts
UK Listing Authority Advisory Panel (LAAP)
within Aegon Ireland’s offshore bond,
LAAP met on 8th February at FCA to
such requests could you let Ian Cornwall
consider the future development of the UK
know. We are trying to ascertain how many
retail market in Corporate Bonds in the light
firms are receiving such requests to explore
of the current legislative and regulatory
whether or not it is worth facilitating a
framework, and of the European Commission’s proposals to reform this in their draft Proposal for a new Prospectus Regulation (PD3).
asking for extensive information on a monthly basis. If your firm has received
meeting between Aegon Ireland and WMA firms. We have not yet approached Aegon Ireland.
UK Listing Authority Advisory Panel (LAAP) continued…
Offshore Accounts
The upshot was agreement on the abolition
HMRC on 8th February to discuss the draft
of the €100,000 denomination threshold
regulations implementing the requirement
and the creation of a unified and summary
to notify clients about disclosing offshore
prospectus to underpin a single market in
accounts.
plain vanilla corporate bonds. Further work
WMA will provide a fuller note of the
is required to create the prerequisites for an
proposals and what the potential impact
improved and better functioning UK retail
could be on WMA member firms in the
bond market in the future. WMA is at the
next WMA Update.
WMA and some of its members met with
heart of these discussions.
Risk Guidelines Prospectus Directive
WMA has submitted a response to the
The FCA’s Prospectus Regulation
European Supervisory
roundtable on 29th January, attended by
Authorities consultation on risk
both FCA and Treasury, hosted over 20
guidelines, which contains a list of
participant organisations including the
indicators that firms will need to use when
WMA. It agreed that HMT should press in
assessing Anti Money Laundering risk, and
Council discussions for the abolition of the
to CP 15/35 which contains proposed
€100,000 prospectus exemption threshold
handbook changes to the market abuse
for corporate bond denominations, and for
regime.
the summary prospectus, as proposed by both WMA and the European Commission. This was against some wholesale market opposition to both proposals.
What's happened in WMA? WMA Special Interest Group
WMA meets DBIS about De-
Meets with FCA to Discuss Transaction Reporting
materialisation of Share Certificates
On 4th February WMA and 7 member firm
On 29th January WMA met with the official
representatives discussed the transaction
responsible at the Department of Business,
reporting aspects of ESMA’s recent
Innovation & Skills (DBIS) for the
Consultation Paper. Particular focus was
consultation on de-materialisation of share
on LEIs and also the requirement to obtain
certificates. It provided a good opportunity
the client’s first name and surname from the
to explain a brokers’ role in the process and
person’s passport to “minimise the risk of
where their key costs and potential benefits
difference in spelling or use of
would be in a de-materialised world. DBIS
abbreviations” – see Page 21 of the CP.
are provisionally planning to issue a
The latter issue would have major
consultation paper towards the end of Q2
ramifications and WMA will be pursuing this
2016 but have agreed to discuss their
further both as part of our response to
proposals in more detail with the WMA
ESMA as well through other channels.
Retail Markets Committee in March.
National Crime Agency to attend WMA Committee
Launch of WMA Millennial Forum
Following our Financial Crime Conference
The WMA Millennial Forum was launched
on 28th January the National Crime Agency
on 2nd February which consists of up and
(NCA) will attend part of the next WMA
coming talent in the industry who will
Financial Crime Committee to further
formulate ideas that will contribute to the
discussion and action on improved
continued success of the wealth
engagement between the NCA and the
management industry and address the
WMA Community.
challenging question of how to attract, engage and retain a new generation of
Spotlight on Financial Crime
clients. Read the full press release here.
A number of key pieces of information Conference to help firms in their fight
WMA meeting with HMRC on Charities Guidance
against financial crime. Attendees
HMRC have sent WMA draft guidance on
witnessed a demo hack by the ethical
how charities are classified under the
hacker, Mustafa Al-Bassam, illustrating how
OECD’s Common Reporting Standard.
hackers break through firms electronic
WMA and several member firms met
defences and access their and their clients’
HMRC officials on 8th February to discuss
data. It took him just over 0.77 seconds to
the draft guidance. Once finalised it will be
review a million passwords and find the
published on HMRC’s website and we hope
correct one to crack an account - indeed,
will be useful for WMA members and
several accounts, given the password’s
something that will help answer any queries
multiple applications. The lesson: change
from their charity clients.
emerged from our Financial Crime
your passwords frequently, do not have the same one for all purposes, and make them difficult - with a mixture of numbers, letters and capitalisation!
European Board Sub Committee Meets The WMA Board’s new European and
European Retail Financial Forum (ERFF)
International Sub-Committee met for the first time on 2nd February to look at the range of WMA’s European work and
WMA is a founding member of the new
consider the best strategy and handling
ERFF which began in 2015. This group met
methods for this in the future.
on 3rd February in Brussels to discuss the
Likely areas of focus are:
EU Commission Green Paper on EU Retail
- Digital
Financial Services with the key Commission
- Prospectus work
officials responsible. The debate included
- Capital Requirements and Remuneration
the possible future impact of the growing
- Future of ESAs, funding and efficiency of
digital economy on the EU’s retail cross
supervisory convergence.
border financial services business. WMA is creating a specialist group on digital from among the membership. If you would like to know more please contact John Barrass.
MiFID II and FSCS New Members
We continue our engagement on MIFID II
Welcome to our new associate members:
and we have recently presented to FSCS
- Invesco Asset Management
staff on the challenges faced by our sector.
- Kroll Associates UK
We are also meeting with member firms
- RBC Investor & Treasury Services Trust
and associate member firms on a regular
(UK)
basis. We are very keen to maintain a dialogue with firms on MIFID II – if you would like to meet with us please email Ian Cornwall.
Coming Up What's coming up in our industry? The Joint Money Laundering Steering Group (JMLSG)
FCA Meeting on Diversification of Client Money in the Current
The JMSLG Editorial Panel will meet on
Market Conditions
10th February to begin the assessment of changes to propose to the JMLSG Guidance in the light of the 4th Anti-Money Laundering Directive and Regulation now agreed at Level 1. This work will be ongoing as Level 2 work from the European Supervisory Authorities (ESAs) is developed.
We are aware that firms are finding it increasingly difficult to diversify their holding of client money. Many banks do not wish to hold client money. We have continually raised this issue with FCA since the original publication of the CP banning term deposits for longer than 30 days. We fed information on current market conditions to FCA just before Christmas and we are expecting the
FCA Meeting on MIFID II Product Governance and Cost
CASS team at FCA to discuss this issue with us and other trade associations shortly.
and Charges
The date has yet to be fixed and we actively
The FCA postponed the meeting due to be
pursuing this.
held with the WMA and other trade associations on 8th February on the above
RDR Exam Syllabus
topics. The FCA has not explained why the
The FCA is currently holding a series of
meeting was postponed but we assume it is
meetings with stakeholders updating the
because the Delegated Acts have still not
RDR Syllabus. The revised RDR Syllabus
been published – we are expecting them to
will in due course be published in a
be published in March - but then again we
consultation paper. We are attending the
have been expecting them to be published
meetings. The focus of our input is to try
next month since last July!
and ensure that any proposed revisions recognise the different business models within the WMA’s membership.
Early Implementation of 4th Money Laundering Directive? The EU Commission submits a proposal to bring the implementation date of the fourth Anti Money Laundering Directive forward to Q4 2016 at the latest. We live in uncertain times…Read the full communication here.
What's coming up in WMA? Women in Wealth
WMA to meet MEPs
The WMA are looking forward to welcoming
John Barrass will visit Brussels on
our members to the first ever Women in
16th/17th February to meet, among others,
Wealth event on the 9th March. The event
Catherine Bearder - the only British Lib
will gather women from across the industry
Dem/ALDE MEP, Neena Gill, MEP - the
for peer-to-peer networking and inspiration.
Social Democrat/S&D Shadow Rapporteur
To ensure you don’t miss out, sign up
for the Prospectus Regulation), and Tom
through our new events area.
Vandenkendelaere MEP - the Christian Democrat/EPP Shadow Rapporteur, also
WMA MiFID II Bible
for the Prospectus Regulation.
Whilst we continue to be in a ‘rolling
John met Phillipe be Backer MEP, the
deadline’ scenario, WMA are progressing
Liberal main Rapporteur, before Christmas
on multiple areas - details can be found on
with the aim to ensure that the European
the member’s only MiFID section of our
Parliament agrees with the WMA’s
website which you will need to log in to.
approach to the draft Prospectus Regulation and proposes amendments
Please note your username is your first
accordingly.
name and surname together i.e. JohnSmith and the password will have
WMA Insight 360: The Client
been issued to you separately. If you have
Experience
forgotten or wish to apply for your WMA log
The WMA are excited to host the first
in details, please contact
Insight 360 event of the year: The Client
us enquiries@thewma.co.uk.
Experience 10th March. This insight series will be used to discuss what we, as an industry, are doing to improve the client experience for the end investor. The panel will consist of SMEs on the topic of Client Experience who will share their insights and debate the challenges the wealth management industry faces. More details can be found on our new events area.
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