(Consumer) Duty calls: one month to go
With just one month to go until the Consumer Duty comes into force, FCA have published an update urging firms to ask themselves the right questions, to make sure they are on track and make the most of the remaining time.
In the update, FCA remind firms of the list of questions included in the finalised guidance (FG22/5) (see section 9.54) which are described as the types of questions firms can expect to be asked in their dealings with the FCA but also the types of questions FCA expect firms (in particular the Consumer Duty Champion) to be asking themselves.
But another question some might be asking is… really? Isn’t Consumer Duty all just a load of hot air which will soon pass?
But here’s why we think you can’t avoid the noise and why we’re urging firms to ensure appropriate resource is directed at complying with the new rules…
We do not have details of how the FCA will review the implementation of the tens of thousands of firms it supervises, but failing to take appropriate (and proportionate) action is a genuine risk.
This is not a case of a technical change to be forgiven, simply lost in the weeds and easily corrected, or a missing policy that can be dropped in at the final hour. It’s more far more substantial than that. There will be no excuses for a failure to act. All of the noise and fanfare means putting your head in the sand is not a defence, it just makes it easier to be caught.
The FCA have a tendency to consider an absence of effort absolutely fair game. If firms who are subject to the Duty (even indirectly) ignore the new rules and get caught out...the FCA is likely to take action which could cause considerable harm to your business, with senior managers held responsible.
The FCA will not have a hard time identifying failure either. They only need to use simple and familiar tools i.e., survey questionnaires/email requests for documentary evidence and management information. Guilty firms will stand out and examples can be made...the FCA do love low hanging fruit.
So, ignore all the noise at your peril. You don't have to like it, you just have to get on with it.
And to those firms we mentioned earlier who might be asking “really?”, who expect it might go the way of TCF; a flash in the pan, a public statement designed to look and sound good. That’s not an unreasonable suggestion, but just have a look at the FCA business plan. The Duty is centre stage and it can’t be underestimated how much the FCA believe in it and how hard they will be working to ensure it is a success.
And even if this noise does blow itself out eventually, only a real gambler stands in the path of a tornado.
How can ComplyCraft help?
Get in touch if you have any questions, would like a copy of our templates or if you need more substantial support to ensure your implementation programme is completed satisfactorily.