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SM&CR

The Senior Managers & Certification Regime (SM&CR) replaced the current Approved Persons regime for all solo regulated firms* on 9 December 2019.  SM&CR has significantly raised the bar on standards of personal conduct and put a new, more stringent emphasis on management accountability.

The Senior Managers & Certification Regime impacts not just your board members and senior managers but anyone in your firm who’s involved in any aspect of regulated activity.

We understand exactly what SM&CR requires and we have already applied this knowledge to help a wide range of businesses comply with the new regime.

What you need to know about SM&CR

  • The regime replaces the category of Approved Persons with that of Senior Managers and charges Senior Managers with a range of new responsibilities.
  • As well as looking at Senior Managers, SM&CR also requires firms to identify individuals in the next tier of management down and those performing certain specific roles (certification functions). At least once a year, firms must evaluate and certify these named individuals’ fitness for the roles they perform.
  • SM&CR also introduces criminal record checks for both Senior Managers and non-executive directors for most firms.
  • The Senior Managers & Certification Regime also introduces a new template which firms must use to provide regulatory references for Senior Managers and staff in certification function roles.
  • Another significant difference is that there are specific Conduct Rules which apply to all staff (other than those in ancillary roles, e.g. cleaners). Staff impacted by the Conduct Rules need training in the rules as these apply to their roles. SM&CR includes additional rules for Senior Managers and requires that any breaches of the rules which result in disciplinary action must be reported to the regulator.

What you need to do to comply with SM&CR

9 December 2019 was the first Senior Managers & Certification Regime deadline. Among other matters, by this date you needed to have Senior Managers holding the correct Senior Manager Functions, to have identified your certified staff and to have trained these staff and Senior Managers in the Conduct Rules.

9 December 2020 – the next deadline. Between now and then, you need to be collecting evidence to demonstrate that certified staff are suitable to do their job so you can issue their certificate. Plus, all other staff impacted by the Conduct Rules need to have been trained in the rules as these apply to their role. You will also need to upload information on Directory Persons to the new FCA Directory, via Connect, by the deadline.

The Senior Managers & Certification Regime is a significant change in how the FCA regulates senior employees. As well as exposing your organisational structures to more intensive scrutiny, it has increased the onus on you to make sure your staff are fit and proper for the roles and responsibilities you’ve allocated them.

There’s a lot involved in making sure you comply with the new regime and are ready for the next Senior Managers & Certification Regime deadline – but help is at hand.

As a starting point, you can download our document 10 Steps to SM&CR Compliance (available in three sector-specific versions) by clicking on one of the links below:

How can we help?

We’re already helping hundreds of firms comply with the new regime, walking them through the various elements of SM&CR, explaining how this impacts their businesses, reviewing their arrangements, providing expert advice and answering a host of questions.

In other words, we have the skills to help you ensure you’re meeting the new requirements.

  • We’ll review your current SM&CR arrangements and provide advice and suggestions for improvement if needed
  • If you need help making sure the Conduct Rules are properly trained in for Senior Managers and Certification staff we have both online and face to face courses which can help
  • We also have face to face training and online courses for other staff impacted by the Conduct Rules to ensure all training is completed well in advance of the December 2020 deadline
  • We can assist with your certification process, making sure you have the tools in place to confirm suitability and issue the certificate before the deadline

To learn more about how we can take the stress out of complying with the Senior Managers & Certification Regime, please get in touch. Contact us on 0207 436 0630 or email info@thistleinitiatives.co.uk.

* SM&CR does not apply to payment services firms or Appointed Representatives


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