With FSA audits at the forefront of mortgage brokers and financial service providers minds over the next few months, Compliancy has warned that a key area of compliance the FSA will be checking is training and recruitment.
“The Insurance Mediation Directive (IMD) and Distance Marketing Directive (DMD), require financial service providers and mortgage brokers to demonstrate the competence of all staff involved in insurance mediation. This is an area which can sometimes be overlooked by businesses when focusing on other areas of compliance”, comments Tony Worthy, Managing Director, Compliancy Services Ltd. “Under the IMD and DMD regulations, financial service providers are required to comply with a series of ‘commitments’ to the training and competence of their employees. These include demonstrating that employees are and continue to be competent at a level that is appropriate for the work they do. They must also be supervised and their competencies regularly reviewed.
“Recent research amongst the mortgage sector has demonstrated that there is already a healthy proportion of the industry who have prepared their business for compliance. However, ongoing testing and verification, with a documented audit trail, is critical to demonstrate the commitment that staff involved in insurance mediation will continue to be compliant. One of the requirements of the FSA regulatory reporting is sight of documentary evidence”, confirms Worthy.
“There are a number of areas that the FSA will be covering in their audit. However, the ongoing training of staff is an area we feel can be easily over- looked. “
Comply-INS is already an integral part of the compliance programme offered to mortgage brokers and financial service providers. The Comply-INS system enables customers of Compliancy Services to cost-effectively test staff on their own premises, automatically mark and correct tests, plus it provides appropriate reading material when incorrect answers are given. The service also provides certificates of competence, plus, a comprehensive on-line diary and audit trail of tests taken. These are all vital processes that need to be undertaken to ensure employees remain compliant following the initial training. It also means that authorised firms are able to provide the FSA with documentary proof that as a business, they are complying with the regulations.
“The testing modules offered online to customers of Compliancy Services Ltd are targeted to ensure that each of a company’s employees knows what they need to know about regulated general insurance activities” concludes Worthy.
