Surprise over what the FSA does not ask
I would like to comment on your cover story reporting the Financial Services Authority's concern ove...
I would like to comment on your cover story reporting the Financial Services Authority's concern over client money non-compliance ('Regulator warns of "widespread non-compliance"', PM, 21 July, p1).
We were surprised, when completing our first Retail Mediation Activities Return, that our compliance and client money resource was not interrogated.
We expected the RMAR to be exactly where client money would be investigated by the FSA.
Also, a company is asked to state the net assets, without any opportunity to exclude unearned commissions, as required by the Cass rules.
Secondly, a company is asked to state the amount of money in the client bank account, which is a completely meaningless figure without knowing the amounts due to and from insurers and clients. We are amazed that no client money resource reconciliation is required.
We raised these and other queries two weeks ago, but have yet to receive a reply.
Since the good guys would have to fund the bad guys' shortfalls via the Financial Services Compensation Scheme, we believe that we are entitled to expect the FSA to be diligent in its role of monitoring firms' client money resource.
Are we missing something? Or is the FSA?
Geoff Foster Taylor
Senior Partner,
Taylor Price and Company,
Newmarket.
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