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FSA gets tough as figures reveal 65% spike in skilled persons reports

FSA gets tough as figures reveal 65% spike in skilled persons reports

There has been a 65% rise in the number of skilled persons reports commissioned by the Financial Services Authority (FSA).

Quarter on quarter, the last data from the regulator has shown that the number of skilled persons, or section 166 reports, has climbed from 23 to 38.

Banks continue have continued to top the list of firms asked to complete the studies, usually ordered where the FSA wants to take a closer look at a business' systems and processes.

According to previous investigations by Wealth Manager, skilled person reports can cost up to £2 million and swallow up to 500 hours of staff time.

Earlier this month Ashcourt Rowan was fined £412,000 by the FSA and later said this was in fact linked to two section 166 orders for suitability issues within its Savoy Investment Management business. At the time, the listed wealth manager's group chief executive Jonathan Polin said he believed Ashcourt Rowan would be the first of many eventually hit by the FSA's rule.

The latest figures from the FSA showed that banks and building societies accounted for 21 of the 38 section 166 reports commissioned, looking at the three month stretch running to 30 September.

Four reports were commissioned in respect of investment managers with personal investment firms also asked to commission four reports.

During the FSA's first quarter, which ran to the end of June, the regulator ordered a total of 23 reports. Banks again accounted for the bulk of these, followed by investment management and securities and futures firms.

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