Risk-based Compliance Monitoring

Thursday 10th October, 2024

Delivered Virtually, Zoom

Attendee Fees: Non-members: £535 (VAT Exempt), Members: £385 (VAT Exempt)

Time: 09:30 - 16:30

Duration: 7 hours

COURSE DETAILS

Timings: 9.30 -12.30, resuming 13.30 -16.30

Risk-based monitoring is a fundamental staple of the regulated environment, but with firms being disciplined on a regular basis for failures of compliance, questions arise as to the effectiveness of the monitoring in place, whether it has the right aims and objectives, uses appropriate tools and is implemented by suitably skilled staff.

This full-day course aims to address these concerns by first deep-diving into what monitoring is supposed to achieve and the lessons firms might learn from the FCA’s approach.

It then focuses on the importance of a high-quality risk appetite statement and risk assessment as drivers of an effective monitoring programme and explores techniques such as graphic mapping and the Conduct Risk Journey as frameworks for value-added risk assessment.

The course rounds off by examining various monitoring methodologies, the problems and issues with sampling and hints for effective report writing and for ensuring that the monitoring team has the right skill set for the challenges it faces.

Course Overview

By the end of the course delegates should:

Understand what drives FCA supervision and the impact this should have on your own monitoring activities
Know the role monitoring plays in the SMCR/ “reasonable steps”, TCF, Consumer Duty and the Conduct Risk Journey
Understand the importance of clear definitions and mandates
Understand the potential value of various mapping exercises for getting a better understanding of how your business fits together and the risks that raises
Have an understanding of risk identification and reporting and how that can be used by senior management
Understand the benefits of using the conduct risk framework for structuring your monitoring
Have a better understanding of, and some more creative ideas around, sampling
Understand the key points of effective report writing bearing in mind the needs of all stakeholders
Examine the purpose of monitoring, the importance of mandates for the various oversight functions and what monitoring should be aiming to achieve
Understand the FCA’s own approach to monitoring, what ideas it offers to firms and how they might benefit from adopting a similar approach
Monitoring Outcomes or Rules
The critical nature of a high-quality risk assessment as a solid foundation for your monitoring programme
Ensuring firms adequately address “outcomes-based” regulation, including Conduct Risk and the Consumer Duty
Identifying your skills gaps and how to plug them

Agenda

Examine the purpose of monitoring, the importance of mandates for the various oversight functions and what monitoring should be aiming to achieve
Understand the FCA’s own approach to monitoring, what ideas it offers to firms and how they might benefit from adopting a similar approach
Monitoring Outcomes or Rules?
The critical nature of a high-quality risk appetite statement and risk assessment as a solid foundation for your monitoring programme
Ensuring firms adequately address “outcomes-based” regulation, including Conduct Risk and the Consumer Duty
Using diagrammatic mapping of the firm and the Conduct Risk Journey as frameworks for risk-assessment
The monitoring process
Issues around sampling
Good practices for report-writing
Identifying your skills gaps and how to plug them
Case studies throughout

Trainer

The session will be delivered by Gary Pitts.

Gary has been a compliance professional for over 30 years, having started his career at Lautro and the Personal Investment Authority and including spells at Threadneedle, Henderson (managing the N2 transition), Head of Compliance at hedge fund Brevan Howard and Head of Compliance Europe, Mid-East, Africa and Japan for a boutique investment bank. Since 2013 he has run his own regulatory and training consultancy, Tetractys, with operations in the UK and Ireland. Tetractys focuses the importance of governance as the essential driver of good compliance outcomes. He delivers open and bespoke training courses and external Board effectiveness assessments alongside his consulting work. Gary has a particular interest in cyber security governance and the impact of digitisation and artificial intelligence on compliance and business processes.

Gary has held FCA controlled/senior manager functions in FSA/FCA regulated firms since 2001, has been a director of regulated companies in the UK and South Africa and is also has been a Central Bank regulated person in Ireland, as well as being a compliance officer for National Futures Association and SEC registered firms in the US. Gary is a Fellow of the Institute of Leadership, Fellow of the Chartered Management Institute and holds an MBA from the Open University Business School and Masters degrees from Oxford and London Universities. He is a practising expert witness working towards Certified Expert Witness status. He sits on the regulatory advisory board of the Journal of Securities Operations has also held a number of charity trusteeships.