Press release

PIMFA welcomes FCA regulatory forbearance in wake of coronavirus outbreak

1 April 2020

PIMFA, the trade association for the wealth management and financial advice industry, welcomes the action taken last night by the Financial Conduct Authority (FCA) in respect of wealth management and financial advice firms.

As their members already know, PIMFA flagged issues off-record with FCA very early and then wrote to the FCA and HM Treasury (HMT) ten days ago outlining the concerns and potential impact of coronavirus on member firms and their clients after consultation with the membership.

Since then PIMFA has held meetings with the FCA providing feedback from member firms on the compliance and operational issues many are facing in the current climate.

Among the concerns outlined by PIMFA Chief Executive Liz Field, was the need for guidance and clarification for firms on how they should engage with the regulator in this period of uncertainty.

In response, the FCA has written to all firms outlining temporary changes within the regulatory framework in light of the current crisis.

These changes include greater flexibility over client identification verification; supervisory flexibility over best execution until the end of June; supervisory flexibility over 10% depreciation notifications until the end of September and a pause on the implementation of investment pathways and other measures.

PIMFA Chief executive Liz Field said: “I am greatly encouraged by the response from the FCA in its ‘Dear CEO’ letter to firms, which many firms will no doubt be receiving today.

“It shows the constructive work that has been carried out by PIMFA on behalf of our members. It also shows the FCA has not only been in ‘listening mode’ but has taken the concerns of our members seriously and has been willing to act and show the regulatory forbearance I have said our members need to continue to serve their customers in these extraordinary times.

“To have done so at a time when the FCA’s resources are being stretched and it is being inundated with queries from firms is to its credit and todays’ letter should provide much needed clarity. We have also raised the operational concerns many firms may have and the guidance provided by the FCA on how Government schemes should be treated in order to maintain financial resilience is helpful.

“PIMFA will continue to engage positively and constructively with the FCA and others on behalf of our member firms and I would continue to urge members to contact us with their concerns, so that we can continue to engage with the FCA in as informed a manner as possible.”