Managing risks with a T&C Scheme

Every firm in the UK should be aware of the regulatory changes that are on the horizon, which will require every broker to have a suitable and demonstrable Training & Competence Scheme.

While every firm should be aware, how many have taken the necessary steps and implemented a suitable T&C Scheme?

As a broker, if you don’t have a T&C Scheme in place (or are at least trying to create one) then how are you able to monitor the competency of your staff?

How can you demonstrate to the FCA that you take the fair treatment of your customers seriously?

There are many reasons why you should have a T&C Scheme in place; it is not simply a case of fulfiling your regulatory obligations. Of equal importance is being able to highlight potential risks to your business.

As a firm, you’re responsible for the competency of your staff and for updating your agents on regulatory and product changes.

The FCA like all staff (and AR’s) to be included in your T&C Scheme.

When it comes to demonstrating the steps you have taken, the thing to remember is, “if it isn’t written down there is little evidence that it happened." It is that simple.

If it’s not written down it’s more difficult to show to someone else what has happened. If that is a court or a Regulator, your case is more difficult to establish.

More than that, a written plan for your T&C Scheme sets everything down for staff, agents and directors to see. In a world of personal responsibility arriving under IDD and SMCR, that puts you and your colleagues in a much stronger position to show to others that you have discharged your duties.

The right to self-certify competence of your team is given to you under both IDD and SMCR and my job is to help you meet the challenge in a compliant and competent manner.

You should be keeping records of any activities around T&C, including:

  • Recruitment and selection
  • Training
  • Assessing competence
  • Your benchmark standards
  • Staff supervision
  • Qualifications obtained and CPD

These records must be kept for at least three years following the completion of scheme activity, with the exception being that if you are a pensions transfer specialist, these records need to be kept indefinitely.

The FCA says that “firms need procedures in place with clear criteria for individuals to be assessed as competent, so all parties involved understand when competence has been reached.”

So if you don’t currently have a T&C Scheme, NOW is an excellent time to begin putting one in place.

If you would like to discuss this further or need any assistance with building a T&C Scheme for your firm to fulfil regulatory requirements and strengthen your business, then RWA can help!

We can be with you every step of the way to make sure you’re doing it right, and more importantly, manage the risks to your business.

Email for further information.

About the author

Before joining RWA Nicola was a recruitment professional holding posts such as Senior Recruitment Consultant, Senior Account Manager and Senior Business Development Consultant.

Nicola joined the RWA team as Business Development Manager covering all areas of the business before moving into the role of IDD / T&C Scheme Specialist.

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