As part of the extension of the senior managers and certification regime (SMCR) to solo-regulated firms, these firms were required to submit to the FCA data on their Directory persons by 31 March 2021. This data is required by the FCA to create a public Directory of those persons on the Financial Services Register. The Directory is being created because, following the introduction of the SMCR, there are individuals performing roles that are no longer made public on the Financial Services Register when they were previously (as approved persons). The Directory will also make public information on additional roles, such as those providing mortgage advice, for the first time. The Directory may be used by clients verifying information about a Directory person or by firms carrying out due diligence before hiring an individual.
Directory Persons include:
all Certified staff (those holding a certification function under the SMCR);
directors who are not performing Senior Manager Functions – both executive and non-executive; and
other individuals who are sole traders or appointed representatives (including those within appointed representatives) where they are undertaking business with clients and require a qualification to do so.
The information to be published on the Financial Services Register includes:
name and any previous names;
roles, with start and end dates; and
activities undertaken by the individual.
For customer-facing roles requiring qualification, additional information includes:
customer engagement methods;
workplace location (where relevant); and
membership of professional bodies.
Solo-regulated firms must ensure they have carried out the assessment and certification of individuals within their firm and submit the relevant information to the FCA through its Connect portal.
It is reported that the FCA is contacting approximately 2,800 firms which previously had approved persons and provide consumer-facing activities (which implies these firms are likely to have Directory Persons and have failed to notify the FCA of the required data by the deadline). When contacted, such firms are given a week to comply or explain to the FCA why they do not need to submit data.
Firms that have not yet submitted their data to the FCA should act now. Non-compliance of regulatory reporting obligations exposes a firm to the risk of enforcement action.
If you need help in understanding your obligations regarding the SMCR or submitting Directory data, we can help. Please get in touch with one of the contacts above.
Authored by Michael Thomas and Yvonne Clapham