FCA principles for biz

how many principles for business does the FCA have

12

what are 1-5 of those principles, and what do they focus on

focus: run the firm

acronym: I See My Future Man…

1. Integrity - be honest

2. Skill, Care + Diligence - be professional/competent

3. Management + Control - good governance + risk systems

4. Financial Prudence - sufficient resources (eg capital, liquidity()

5. Market Conduct - proper trading standards

what are 6-9 of those principles, and what do they focus on

focus: deal with customers

acronym: customers can be C-C-Cuh-RAZY!!

6. Customer’s Interests - treat customers fairly

7. Communications - clear, fair, not misleading

8. Conflicts of Interest - manage them

9. Relationships of Trust - suitable advice/decisions

what are principles 10-12 of those principles, and what do they focus on

focus: protect + supervise

acronym: Can’t Run, Crook

10. Client Assets - safeguard them

11. Regulator Relations - cooperative engagement with FCA/PRA

12. Consumer Duty - good outcomes for retail customers

when might principle 12 not apply (“out of scope”)

if there is no retail customer

BUT

if a wholesale firm materially influences retail outcomes then its not out of scope

if principle 12 doesn’t apply, what happens? (and vice versa)

doesn’t apply? then principles 6+7 apply, and FTOC

if it does then it replaces 6+7

what are the 3 cross-cutting rules of consumer duty

act in good faith

avoid forseeable harm

support financial objectives [of customers]

what does cross cutting mean

rules that apply across the whole consumer duty