How Brewin Dolphin is preparing for Fatca

Regulatory burden

Since the possible impact of Fatca first came to light, a number of individuals have spoken out about their fear of such a broad brush and US-centric regulation coming into force in the UK.

Auditor PricewaterhouseCoopers (PwC) recently said that fund distributors and advisers would likely shoulder the burden of the work and have to put in place robust processes to identify their clients’ nationality and residence. 

However, in a report on Fatca, PwC also said that many were unaware they faced this task, and were under the illusion that even if they did not have US clients, they would still need to have in place processes to identify all their investors.

The same study also estimated the cost of implementing Fatca at £20 to £70 per investor, though these predictions may not match assessments made by smaller providers without economies of scale.

Matheson said that while the firm did not have a view on Fatca’s necessity for wealth managers, it was still up to the firm and its 42-strong network to ensure it complied with the new rules.

Systems development

Matheson added that the firm has £18.3 million in surplus capital adequacy, which he feels is ‘about right’, so is well positioned to be able to absorb the additional costs of Fatca.

He added that Brewins remains on track to begin migrating assets onto the new internal platform it is building in the new year.

This process, which aims to better integrate its investment management and financial planning arms, will be fully completed in 2014 and is expected to result in cost savings down the line.

Elsewhere with the business, he said no further consolidation within its branch network is planned imminently, but he refused to rule it out if the circumstances were right.

‘We have consolidated two offices recently – Dumfries with Penrith and Elgin into Inverness. These followed Scarborough into York in 2008 and Eastbourne into Brighton in 2010,’ he said.

‘We would bring other branches together if similar situations arise and providing of course, it is in the interests of our clients as well as our staff.’