Understanding the FCA thematic review (part1)
Understanding the FCA thematic review (part1)
The Financial Conduct Authority carries out regular ‘thematic reviews’ into areas requiring further review by firms in the financial services industry.
Why does the FCA instigate a thematic review?
For the FCA, thematic reviews are a central element of its activity. Thematic reviews are used to ‘assess a current or emerging risk relating to an issue or product across a number of firms within a sector or market’. As an example in 2019, it conducted a thematic review of the debt management sector.
The objective of a thematic review?
The review will usually aim both to discover what is happening in the market and identify any current issues, and identify potential solutions to address these issues.
The FCA’s thematic reviews are sometimes also referred to as ‘issues and products’ work or ‘cross-firm work. The thematic review process can be applied to a wide range of situations, firms, or groups of consumers.
A thematic review aims to allow the regulator to investigate key risks that have been flagged or it has spotted. If specific risks are identified, further detailed work is carried out into a particular area of concern.
Regulatory Toolbox
Thematic reviews are one of the tools in the FCA’s regulatory ‘toolbox’, along with its risk management approach, operational framework, mystery shopping activities, and Skilled Persons’ Reviews.
The FCA may also seek attestations from senior management in firms with specific issues, and put in place enhanced supervision for firms where they have particular concerns.
Tune in for part 2 for what a review may consist of, how to remain ready and cognisant of a review, and preparation for an FCA visit.
Related Posts
5 Steps for Conducting Effective Compliance Control Monitoring for Financial Firms
Compliance control monitoring is a crucial aspect of maintaining regulatory compliance for financial firms. The Financial Conduct Authority (FCA) requires firms to have robust controls and monitoring systems in place, and it is up to individual firms to implement these measures effectively. In this article, we will discuss the steps that firms can take to conduct compliance control monitoring.
Anti Money Laundering warnings
The Financial Conduct Authority (FCA) issued a warning to retail banks in May 2021 (made public on 29 June) over continued weaknesses and failings surrounding their financial crime controls.
Are you aware of the FCA rules to protect consumers from rogue financial promotions
Did you know that the FCA has published a consultation paper and press release setting out how it proposes to operate a new authorisations gateway for firms wanting to continue approving financial promotions for unauthorised persons.