WMA Bulletin 9th February 2016

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.

If you have forgotten or do not have your WMA log in details, please contact us at enquiries@thewma.co.uk.

Wealth Management Association (WMA) 22 City Road Finsbury Square London EC1Y 2AJ

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