This FCA Dear CEO letter sets out the FCA view of the key risks of harm that Wealth Management and Stockbroking firms pose to their customers or the markets in which they operate. You should consider whether your firm presents these risks and consider your strategies for mitigating them.
the FCA Wealth Management and Stockbroking supervision strategy covers a 2-year period, which began in April 2019. This strategy includes further work to identify, diagnose and remedy the harm that Wealth Managers and Stockbrokers may cause.
the FCA will communicate as appropriate during the strategy period. At the end of this period the FCA will write to you with the FCA updated view of the key sector risks and the FCA updated supervisory focus.
the FCA view of the key types of harm – the FCA see 4 key ways in which customers may be harmed in this sector:
- by having reduced levels of savings and investments due to fraud, investment scams and inadequate client money, or assets controls
- by losing confidence in the industry’s ability to deliver their financial objectives due to mismanagement of conflicts of interest and market abuse
- through reduced levels of savings and investments due to order handling procedures and execution processes that do not deliver best outcomes
- by being unable to understand the costs of services provided by firms, due to insufficient or inaccurate disclosure of costs and charges