Authorisation And Applications
Conducting most financial activities requires some sort of adherence to regulations and laws.
Many of our clients use the Kession platform to gain interim permissions to conduct regulated business while they seek to be fully authorised; others use us because they cannot or do not want a compliance operations function and so outsource to enjoy economies of scale and best business practice.
Being on our platform can help speed up the full direct authorisation process too, as the firm and its business plan and controlled function approved persons will already be known to the FCA.
The authorisation process involves the completion of a very comprehensive FCA application form. Although many new firms try to complete this themselves, most use lawyers and consultants due to its complexity and also to ensure the FCA gives the permissions appropriate to the firm’s business model. If a firm is approved and discovers it has the wrong permissions, the firm must undertake a variation of permissions process which can take at least 6 months to be approved and sometimes longer as the FCA may query why the permission wasn’t sought at application.
However, the application form is only a small part of the process as the firm must have in place many policies and procedures and systems and controls which can some time to create and establish. This can include risk policies, business continuity plans, ethics codes and compliance manuals.
Depending on the permissions the firm is seeking to gain (e.g payment services, advising, investment management, crowdfunding etc) the FCA will always want evidence the firm has people who know what they are doing and will take their compliance responsibilities very seriously. The FCA will seek assurances that the firm’s people are fit and proper.
Being fit and proper and competent at all levels (not just at senior manager level) means ensuring the initial and ongoing due diligence is robust and breach management is effective. The FCA has enhanced the checking process and due diligence includes regulatory references, criminal checks and academic verifications.
Applying for authorisation involves a project management type approach. It is possible to do this without external help but the FCA expect certain answers and documentation and anything they do not understand will normally result in very long delays.
Gaining a case officer to consider an application can take up to 6 months followed by many more months of questions and answers. The FCA has ramped up its due diligence on firms and people and anything out of the ordinary will slow the process down considerably.
Kession can help you navigate this process and help ensure a smooth application process. We have gained a number of authorisations and also have a number of consultants who work for Kession.
Further information can be found at http://www.fca.org.uk/firms/about-authorisation/getting-authorised/faqs.