Happy New Year from Scott Robert Compliance Limited! We have identified the following information for our first newsletter of 2021. The news we will circulate will primarily be on relevant and interesting regulatory updates for FCA regulated firms.

  1. Scott Robert rebrand: Scott Robert has recently joined our close partners the “Northern Provident Group”. We have worked closely with Northern Provident for several years, some of our employees now support Northern Provident with their compliance in operating a peer2peer platforms, managing appointed representatives, arranging investments and many other projects. This group structure presents an exciting opportunity for Scott Robert and our clients who are looking to venture into new, more complex, permission scopes. We welcome 2021 with our new updated logo and updated website, both of which can be found clicking here.
  2. FCA proposed fee hikes: The consultation period closes on the 22/01/2021 for CP20/22 wherein the FCA has outlined proposed application fee increases for potentially Q2 2021. The FCA will review the feedback received and provide notice of any changes in March 2021. The proposed changes would result in an increase to the cost of applications for firm’s seeking authorisation for certain activities including Claims management companies (which is proposed to increase by 108%). We have recently published a summary article of this development with further information on our website. For more information on the proposed FCA fee hikes and access to our recent article please click
  3. SM&CR Updates December 2020: The FCA has released some additional reminders that statements of responsibility (SoR) for SMF holders should now (as of 7th January 2021) submit Form Js if any significant changes are made to SoRs due to furlough or coronavirus infection. Senior managers who are subjected to these circumstances cannot reasonably be expected to carry what is stated in their SoRs therefore amendments or distribution of responsibilities may be required. This change is due to the FCA considering after a year of suffering from the pandemic all regulated businesses will have adapted or have contingency plans if certain SMF holders are furloughed or incapacitated. Previously, the FCA accepted firms running without SMFs for 12 weeks and any extension of this timeframe could be accepted by a ‘modification by consent’. Any firm who needs to make significant changes to their SoRs after January 7th will be expected to submit Form Js to the FCA. Note, if your firm has made the changes before Jan 7th but is yet to notify the FCA they still can rely on the temporary measures up until April 30th
  4. FCA Reg Data replacing Gabriel: The FCA, is continuing the transition firms from the GABRIEL system to the new RegData data collection platform. RegData is described by the FCA as ‘faster, easier to use and built with flexible technology’. For many firms this will be welcome news as the FCA plans to migrate the system across gradually and in groups determined by their reporting requirements. As a firm you will be invited to register with the RegData system when prompted to do so by GABRIEL, until then firms should continue reporting via GABRIEL. For more information view the FCA’s news release.
  5. FCA Complaints Data: The FCA has released its complaints data for the end of the year 2020. This information aggregates complaints received and reported by FCA regulated firms. The 2020 figures show the lowest number of complaints reported since 2016 at only 2.96million, compared to 6.1million in 2019. The FCA has highlighted the insurance and pure protection product groups had the most significant decrease in complaints recorded from the previous year, in good part due to a 2.76m decrease in PPI complaints. After PPI, the most complained about products in 2020 were current accounts (16% of all complaints), credit cards (8%) and other general insurance products (7%).
  6. Final Notice: Charles Schwab UK Limited: Charles Schwab was issued a final notice in December 2020 by the FCA for breach of Principle 10, 11, Section 20 of the Financial Services and Markets Act (FSMA) and the Client Asset Sourcebook (CASS) rules. The FCA found it had failed to adequately protect client money by lacking sufficient procedures and controls to clearly distinguish client monies from each other as well as the firm’s own capital. The FCA noted that the firm relied heavily on its affiliate Charles Schwab & Co who provided external compliance for its use of client money under US rules. The FCA found this inadequate explaining within the notice, that CASS compliance could not be outsourced and US rules on client money are different to the FCA’s. Additionally, Charles Schwab inadvertently mislead the FCA which led to a principle 11 breach and conducted activity when it was not authorised to do so (section 20 of FSMA). The firm received a fine of £8,963,200 with the 30% discount being applied as the firm agreed to the fine without dispute.
  7. Immediate Brexit Changes: The UK has officially left the European Union, with it come some immediate regulatory changes that may be relevant to your business. If your firm is based out of the UK and within the EEA but managed to apply to the FCA’s temporary permission regime you can continue trading as normal with minimal disruption. For UK firms passporting into the EEA the option varies depending on the local regulator’s guidance/expectation. For Credit Rating Agencies (CRA) the FCA has become the UK regulator of UK-registered and certified CRAs. CRAs which previously relied on EEA passporting will now need to register with the FCA to continue their regulated activity.