FSA offers discretionaries PCIAM reassurance

Discretionary wealth managers who have completed the Chartered Institute for Securities & Investment’s (CISI) Certificate in Private Client Investment Advice and Management (PCIAM) can take comfort that the FSA will publish the PCIAM as a proposed appropriate examination for managing investments.

The CISI has confirmed that the Financial Services Authority (FSA) will publish the PCIAM as a proposed appropriate examination for managing investments in its October Quarterly Consultation Paper.

The move follows the FSA’s latest paper on Competence and Ethics (CP10/12), which outlined new qualification standards for discretionary managers who formerly relied on grandfathering arrangements. This forms part of its new training and competence regime.

Managers will have 30 months to complete an exam from the FSA’s list of appropriate qualifications for managing investments. This currently includes the Investment Management Certificate, the CISI’s Certificate in Investment Management and the level 6 Diploma in Wealth Management.

The CP10/12 is separate from the retail distribution review (RDR), but caused confusion as the new requirements for discretionary managers were announced a long time after the FSA initially outlined professional standards for advisers as part of the RDR.

Moreover, the PCIAM was initially omitted from the list of eligible qualifications for managing investments included in the CP10/12, which was published in June.

The news will mean that individuals with both advisory and discretionary mandates who decided to take the PCIAM to fulfil the requirements of the RDR will not face additional exam obligations to cover them for managing investments.

The FSA decided to amend the list of eligible qualifications after the CISI made a submission and requested that the qualification be included, after mapping the syllabus of the PCIAM to show that it meets the exam standards for managing investments.

The CISI said the outcomes of the formal October QCP can now be reflected in the December policy statements already announced for CP10/14 and CP10/12.

The CISI has also submitted its new Investment Advice Diploma, an RDR-compliant level 4 qualification, to the FSA for approval, in line with its investment management standards.