Are you compliant...?

Consumer Duty is a significant shift in the FCA's expectations and sets out higher standards of consumer protection. Under the rules, firms should be open and honest, avoid harm and support their customers in choosing the right products which suit their needs. 

The FCA expect firms to have a clear understanding of the new rules and appropriate oversight, with any gaps or weaknesses in systems and controls identified and remedies in place.

Consumer Duty is as much cultural as it is practical within a firm's process. As such, the FCA are closely monitoring how firms have embedded the new rules and will take action against those that aren’t following them.

The below 10 questions will help you assess whether you're on the right track or maybe need a little extra support:

1. Do you have processes in place to ensure that customers are given the correct regulated paperwork and disclosures at the relevant times within your sales process? How is this evidenced?
2. Are all of your policies and procedures up to date and can you evidence that employees are aware, understand and follow them?
3. Do staff of all levels throughout your firm, from managers to administrators, understand their role and responsibility in delivering consumer duty? What training has been undertaken to support this? 
4. Are you satisfied your products and services meet the needs of your customers? How has this been measured?
5. Are all customers provided with sufficient information to make an informed decision about the products and services that you provide - How is this evidenced and monitored to ensure good customer outcomes?
6. How do you test the effectiveness of your sales processes and customer communications to ensure customer understanding and good outcomes? How are you acting on these results?   
7. How have you adapted your sales process, customer communications and support to identify and meet the needs of customers with characteristics of vulnerability? How do you know these changes are effective?
8. How have you satisfied yourself that the quality and availability of any pre-sale and post-sale support meets the needs of your customers?
9. What data, management information and other key performance indicators are used monitor your products and services for effectiveness and fair value on an ongoing basis? How is this reviewed and communicated to staff?
10. What quality assurance checks are in place to ensure that consumer duty is embedded into your business and is being routinely adhered too? What are the consequences, remedial actions and redress if it is not?