UK FSA will assess TCF in Arrow visits
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UK regulator accelerates the integration of Treating Customers Fairly into its supervisory work
LONDON – The UK Financial Services Authority (FSA) has announced it will accelerate the full integration of its Treating Customers Fairly (TCF) initiative into its core supervisory work.
The FSA is keen to emphasise that, despite the financial crisis, TCF remains central to its retail strategy. The regulator expects firms to meet the December implementation deadline and, from next year, firms’ compliance will be assessed during the FSA’s Arrow supervisory visits. TCF compliance will become an integral part of assessments at relationship-managed firms, and the progress of small firms will be assessed through the three-year regional assessment programme under the enhanced strategy.
“Today's announcement means the FSA can deliver the benefits from the TCF programme more quickly. Our focus will be on the outcomes for consumers,” says Jon Pain, managing director of the FSA’s retail markets division. “We will continue to challenge firms rigorously where there are issues and take decisive action where necessary. The standard against which firms will be judged remains high, and the penalties for not complying remain tough.”
The FSA has also published a TCF update reminding firms what is required of them and explaining how they will be assessed.
The December deadline seems unattainable for many banks, which are still scrambling to understand what they need to do to comply.
“We have been advising our clients of the FSA’s intention to move TCF into the Arrow process now for a number of months,” says Joanne Smith, managing director of The Consulting Consortium. “TCF is back on the FSA’s radar now the markets have settled (or are not so erratic and with the US election over). We believe that only 40–50% of firms will achieve the December 2008 deadline. Firms should make a concerted effort over the next 35 days to really demonstrate how well TCF is embedded within their organisations.”
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