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Coronavirus - Guidance for Financial Services - the UK

  • United Kingdom
  • Coronavirus - Country overview
  • Financial services disputes and investigations
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The FCA has today published a statement for financial services firms with guidance setting out its expectations for effectively responding to the Covid-19 outbreak.

Consistent with existing regulatory requirements, the FCA expects all firms to have contingency plans in place to deal with major disruption events such as major virus outbreak or pandemic.  To that end, the FCA and the PRA are actively reviewing the contingency plans of a wide range of firms. This includes assessments of operational risks, the ability of firms to continue to operate effectively and the steps firms are taking to serve and support their customers. The regulators will be particularly focussed on whether a firm has taken steps to identify its most important or critical business services and its ability to deliver those services in light of the disruption that has and will most likely be caused by the Covid-19 outbreak.

The FCA says it expects financial services firms to take all reasonable steps to meet their regulatory obligations during this outbreak. For example, the FCA expects firms to be able to enter orders and transactions promptly into the relevant systems, use recorded lines when trading and give staff access to the compliance support they need. The FCA says it has no objections to firms undertaking these activities from backup sites or by staff working from home, if that ensures firms meet the necessary regulatory standards. In practice firms will also need to take steps to maintain the security and availability of client confidential information and to ensure that (for example) portable devices used by home-workers conform with group policies.  

The FCA says it is discussing with firms and trade associations (such as UK Finance) any particular issues they may have with regards to meeting these standards and it is working with them to resolve these, and that it will keep its guidance under review over the coming weeks. Meanwhile, firms are urging the FCA to adopt a flexible approach to regulatory requirements concerning compliance monitoring, as well as trade verification and booking, as compliance in these areas becomes more complex when large numbers of people are working remotely.  While the FCA has not yet agreed to this, firms consider that the regulator is likely to do so to avoid market disruption.

If you wish to discuss your resilience and response planning with one of our experts then please get in touch with either Craig Rogers or Jake McQuitty.