The format of the reviews will either be a face-to-face interview or conducted on the phone with an FSA adviser or through the completion of an online assessment, dependent on the risks which the FSA sees in a particular firm’s business model
Face-to-face interviews will last for about two hours and will provide feedback on the good practices the FSA has seen or areas where it could see improvements can be made.
It will then be followed up in writing and the regulator will expect to see appropriate action taken. Those who complete an online assessment will also receive feedback.
Where the FSA sees there is an issue they may visit to explore the issue in further detail and provide specific feedback.
The FSA will also test a random number of firms to validate the feedback that has been given which will give an opportunity to test the effectiveness of the regulators approach to ensure it makes the right decisions.
They will test all firms regularly to measure practices are adequate particularly on how effective members of senior management are in identifying and addressing risks the controls they use. The FSA will also use the review to look at financial soundness.
The regulator will be operating a number of workshops on the reviews similar to those run on Treating Customers Fairly.
Nicoll said: “We have built on our experience on the supervision of smaller firms particularly on the work which we have done on treating customers fairly in order to develop an approach that allows us to use our resources effectively and focus on firms that pose the greatest risk and continue to tarnish the reputation of our industry.
“Good, well run and compliant firms will have nothing to fear.”
