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FSA vows to keep pressure on wealth firms amid new probe

by Sarah Miloudi on Dec 18, 2012 at 10:57

FSA vows to keep pressure on wealth firms amid new probe

Wealth managers have been wrapped into the regulator's scrutiny of conflicts of interest, it has emerged.

After writing to the bosses of asset managers in November, Wealth Manager has learned some discretionaries were also contacted and asked to attest as part of the Financial Services Authority (FSA) review.

The news prompted warnings the sector could face tougher scrutiny over the months ahead, and some regulation experts have voiced their fears about the weighty demands being placed on wealth managers' shoulders.

'Where the regulator subsequently finds deficiencies, the individual is an easy target for personal enforcement action,' said Ash Saluja, of law firm CMS Cameron McKenna, who pointed out individuals as well as firms being taken to task over failures could increasingly become the norm.

Indeed new regulator, the Financial Conduct Authority (FCA), has already said it will break with tradition to name and shame errant individuals as soon as a probe begins.

'Personal careers and financial positions are at risk,' Saluja continued, fearing that busy executives may be tempted to sign off systems and processes as compliant without rigourous investigation.

The FSA confirmed that some wealth managers had been contacted as part of the Dear CEO letter sent to asset managers, adding that some hedge funds had been included too.

Speaking about whether or not the City watchdog had plans to ask firms to attest more broadly a spokesperson said: 'We have made it clear in previous releases we are not done looking at wealth managers.'

There will be a second phase of the FSA's thematic review and although the spokesperson said it would not be right to pre-empt its findings, it was correct to regard the tool of written attests as more focused.

3 comments so far. Why not have your say?


Dec 18, 2012 at 12:09

.."the individual is an easy target for personal enforcement action"..............what planet is this guy on? Anyone who has worked in the industry since 1986 has been targetted by compliance personnel often or not who have been manipulated by invasive management. In essence this is why there are so few proper investment firms left operating in PCIAM industry. But of course there has been a massive consolidation of client assets engineered by management often or not who have never managed a client in their lives nor have much interest in capital markets.One only has to look at the make up of all the Board structures to see the reality...there are hardly any proper stockbrokers involved in running these PCIAM operations...."Personal careers and financial positions are at risk"....well he's right but wasn't Stalin too involved in mass extinction of the officer classes and just look what took responsibility in USSR for anything..the corrolation is alarming..."We have made it clear in previous releases we are not done looking at wealth managers".......DONE & TOASTED

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Fred Olsen via mobile

Dec 18, 2012 at 21:45

CoeurDeLion87 totally agree with you,, we are now governed by a bunch of tragic wardens

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Dec 19, 2012 at 17:16

Thank you Fred!

What should alarm Citywire (just who or what owns the Intellectual Property of CW should be addressed immediately for fair and accurate transparency) and the '00s or '000s of Citywire readers is the fact that amongst the people I speak to many feel as I do that our very own Trade Bodies have done more than a lousy job of protecting the interests and moral standards as set by our forbears. I am speaking as someone whose great great g/f appeared in the 1900 Stock Exchange Yearbook (for record) and for record was ignored in the 2000 Year Book by CISI (& all who sail in her). If anyone truly thinks that experience can be extinguished by an examination process that bears very liitle resemblance to what we actually do then they will simply be selected for the list that is being considered by those who have been totally screwed by the process. VIVA LA REVOLUTION!

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