IMPLEMENTING THE AIFM REMUNERATION CODE
A small AIFM had recently varied its permissions to become full scope. It therefore came into scope of the AIFMD Remuneration Code for the first time and was unsure how to implement the Code and its proportionality provisions given the various elements of employees’ variable pay.
Using guidance from the Regulators’ published statements, formal and informal interactions with them, and experience from similar clients, we provided the Finance Director and Head of Compliance with a clear path to complying with the Remuneration Code.
Armed with the guidance, a remuneration structure was proposed to the Firm’s Remuneration Committee which sailed through and gave the Board the confidence that their actions was in keeping with the rules and peers.
AVOIDING A SECTION 166 NOTICE
A City based brokerage was challenged by the FCA on the adequacy of its onboarding procedures particularly its AML risk classification and appropriateness assessment methodology. Without the right response or framework, the Firm was staring at a s166.
We were able to dran on the best practice identified at similar clients, regulators’ commentary on what ‘good looks like’. This allowed us to design an onboarding procedure that incorporated AML risk assessments based on relevant factors, and an appropriateness assessment methodology that considered client experience and crucially, knowledge.
The Firm’s Directors received clarity on what needed to be done, communicated this to the FCA and received ‘clearance’ to proceed on that basis.
As part of the organisational changes brought about by the global COVID-19 pandemic, a third country firm was planning to shift some operations to the UK. This involved moving some staff whose roles fell on the border line of what constituted regulated activity. The firm needed to know to what extent the activities of those employees would be regulated and the most cost effective way for the firm and its employees to operate in the UK.
We considered the business model and drawing on experience, regulatory interactions and understanding of the matters pertaining to the regulatory perimeter,. It allowed us to ofer a professional opinion highlighting what activities fell into scope of UK regulation. We also advised on the regulatory options available to the firm for performing regulated activity in the UK.
The firm’s directors were able to structure their operations and organisational chart in a way that ensured the firm and its employees achieved the jurisdictional outcomes sought and in the most cost-effective manner.
CLIENT MONEY RECONCILLIATION
Our client, a medium-sized Capital Markets firm, raised questions about their internal client money reconcilliations. It became apparent that these were not being carried out correctly. An important issue that could potentially lead to an adverse CASS report and regulatory censure from the FCA.
Drawing on the wider expertise within the team and experiences from similar organisations, the client received clear guidance on the right procedure to follow, fixing the issue before the CASS audit.
The firm was in a much better shape heading into the CASS audit and avoided an embarrassing report to the regulator.