FCA publishes new rules to strengthen accountability in Banking

Today the FCA published its Policy Statement PS16/3, in which the regulator sets out final rules for the new accountability framework for individuals working in banks, building societies and credit unions who perform certain wholesale market activities. The FCA had previously consulted on the new rules in July 2015.

The full statement and related documents can be found here.

The FCA also provided initial feedback on CP15/31: Strengthening accountability in banking and insurance: regulatory references (October 2015) as well as our final rules on an interim regime for referencing, pending a permanent set of rules for references, including transitional arrangements, which we aim to publish in the summer.

As well as ensuring that, in future, senior managers can be held accountable for any misconduct that falls within their area of responsibility, the regime aims to hold individuals working at all levels in banks and other relevant firms to appropriate standards of conduct.
The FCA highlighted that if a firm is affected by the Senior Managers and Certification Regime, it will need to ensure that it is ready for when it comes into force on 7 March 2016.

The statement also provided a summary of key dates

  • Firms are required to submit grandfathering notifications for existing approved persons who will be performing senior management functions under the new regime by 8 February 2016
  • Firms must identify individuals subject to the certification regime and train them in respect of the conduct rules, which will apply when the new regime begins on 7 March 2016
  • A firm has until 7 September 2016 to identify staff under the new client-dealing significant harm function (SHF) or the new algorithmic trading SHF and to train them in respect of the conduct rules, which will also apply from 7 September 2016
  • Firms will have one year, until 7 March 2017, to prepare for the wider application of the conduct rules to other staff
  • Firms’ deadline for issuing certificates for individuals under the certification regime is 7 March 2017

Lavanya Rathnam

Lavanya Rathnam is an experienced technology, finance, and compliance writer. She combines her keen understanding of regulatory frameworks and industry best practices with exemplary writing skills to communicate complex concepts of Governance, Risk, and Compliance (GRC) in clear and accessible language. Lavanya specializes in creating informative and engaging content that educates and empowers readers to make informed decisions. She also works with different companies in the Web 3.0, blockchain, fintech, and EV industries to assess their products’ compliance with evolving regulations and standards.

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