When one suspects a serious ailment, or is diagnosed with one, it is common practice to obtain a second opinion. The same approach should apply in the financial services industry.
It is extremely risky to rely on one’s own interpretation of the relatively new, and hence untested, regulatory legislation. The same applies to one’s compliance officer. He or she may know your business well enough, but it is possible for that closeness to influence the objectivity of their judgement.
Obviously, remedial action can only be taken where the correct diagnosis is made, and in time.
The requirements for appointing compliance officers are fairly wide, and often at the discretion of the FSP. Given the substantial increase in the cost of compliance since 2004, it is understandable that many practices are trying to find a more affordable alternative by appointing an internal compliance officer who also fulfils several other obligations in the business.
The risk that you run, of course, is that you can never escape liability for non-compliance, and accountability for what may follow from such transgressions. Recent findings by the Enforcement Committee recorded instances where misinterpretation of the law was seen as a mitigating factor, but fines still had to be paid.
If you require an annual check-up, or review of a worrisome practice, please send an e-mail to email@example.com for more information on how we can help put your mind at ease.