While the FSA could not be seen to endorse individual companies or consultants, it does provide a full and comprehensive guide to finding a reliable and professional compliance consultant on its website. The reason for this, and indeed the possible reason why RHL fell foul of a massive fine, is because a firm cannot contract out its regulatory obligations and ultimately the responsibility of appropriate trading never leaves the directly authorised (DA) broker or firm.
I have heard several comments by brokers who suggested that the FSA would have much bigger fish to fry before it turned its attention to the smaller firms. This latest fine is proof enough that its attention is wide, reaching across all firms, large or small.
It is therefore imperative, and I cannot stress this clearly enough, that when recruiting your chosen compliance support service provider you ask a number of questions.
It is just as important to establish the service levels that they adhere to as, ultimately, their work ethic will reflect on your business.
Also, don’t be afraid to ask for references or testimonials. After all, you wouldn’t take on a member of staff without checking out their credentials first.
It is still worth keeping in mind that every firm is different and not necessarily will ‘one-size fit all’, so additional aspects and support requirements may need to be considered when putting questions and issues forward as it is the responsibility of the firm to obtain sufficient information from its consultant. But as long as all these things are considered, there is absolutely no need to worry when turning to a compliance consultant for support. Remember that compliance consultants and support companies are there to help and guide the DA firm. They are not there to ‘contract out’ the firms own responsibilities and obligations.
Steve Butler
Head of m2i.
