Going Directly Authorised

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12 August 2019

Are you currently a Registered Individual (RI) or Appointed Representative (AR) and considering going Directly Authorised? If so, read on…

Making the decision to go Directly Authorised (DA) can be a daunting prospect.  But it needn’t be with the right support and guidance. It is important to be fully aware upfront of not only the benefits that direct authorisation provides, but also the implications and differences from being an AR, or RI. Before you start, you need to understand the whole process and what is required of you.

Benefits and Differences of being Directly Authorised

The obvious benefit to being Directly Authorised is that you have more control, you have the final say on the systems and processes within the business and the direction you want to go.  This not only allows you to shape your business as you want but gives you the flexibility of who you deal with and creating a strong trusted brand of your own. The trade-off for this level of autonomy and flexibility is that you take full responsibility for the compliance and AML functions currently CF10 & CF11 with the FCA (SMF16 and 17 under SMCR), both of which are required senior management functions.

Professional Indemnity Insurance (PII) is another area that can cause concern mainly due to costs and negative press around getting cover.  But by having good strong documented systems and controls in place this can help to evidence to a potential insurer how the business will be run without potential internal conflicts and in a compliant manner.  PII insurers want to see that risks are identified and managed with strong policies and procedures to help minimise any areas of a potential claim.

Pre FCA application

It is essential not to rush your application but to spend time compiling the information needed to ensure that it is not returned by the regulator requesting more information/documentation, as this can delay the process considerably.   A good well thought out business plan covering the structure of the business, key individuals, compliance responsibility and support, right through to your target market and how you will generate clients are just some of the areas that are essential to show you have the right controls in place from day one.

Are your client and service proposition documented? Does your Investment Proposition comply with PROD rules? Are you planning to recruit advisers and administrative staff into the business? Having a robust recruitment process is essential to show how you have made your selection, job descriptions and the process you have undertaken to onboard ensuring any certified persons will comply with the Certification Regime.  These are all areas which the regulator will expect you to have considered and will need to be documented in your application to reflect your business.

Time Frame

The regulator quotes 3-6 months from submission of an application to authorisation, however, this can take longer depending on the quality of your submission, so ensure you have built this into your project plan.

Having expert support and guidance throughout your application process can help to ensure that the process moves as smoothly and quickly as possible.

At b-compliant, we offer different propositions to help you become authorised.  We can simply offer advice or we can hold your hand throughout the entire process, the decision is yours.  We are experts in Authorisations and ready to talk to you today.

Call the team on 0161 521 8641 or fill in your contact details here and one of the team will be in touch.