Transforming an Investment Advisory Firm’s FCC Framework

Challenge

A UK-based financial services firm specialising in securities trading, corporate finance and investment advisory services needed help with enhancing its financial crime compliance (FCC) framework due to weaknesses identified by the Financial Conduct Authority (FCA). The firm engaged Guidehouse to enhance its FCC framework generally and to establish a remediation program that would address the specific issues noted by the FCA and beyond.

Soon after the engagement was finalised, the FCA enforced a Skilled Person review (s166) and Voluntary Requirement (VREQ) restrictions on the firm — affecting its ability to onboard new customers and posing a significant commercial impact that required us to adapt. Our role quickly expanded to include developing a strategy for navigating and eventually exiting the regulatory interventions while continuing our work to remediate the FCC framework.

Solution

Instead of waiting for the outcome of the s166 report before moving forward, we worked collaboratively with the firm to remediate its framework while the review was ongoing. While deploying our tried-and-tested methodology to help the firm design and build a robust FCC framework that would meet regulatory expectations, we were able to address the Skilled Person’s feedback in real time and deliver sustainable solutions.

Our work included:

• Enhancing the overarching policy and procedure framework
• Designing a comprehensive enterprise wide risk assessment and customer risk assessment
• Providing detailed training to the money laundering reporting officer and other staff
• Conducting quality assurance over the implementation work performed by the firm

In addition to assessing the firm’s FCC framework and executing a tailored remediation programme, we provided advisory support to senior management and the board on how to effectively manage the regulatory engagement and promptly exit the s166 and VREQ.

Impact 

Throughout the engagement, we spearheaded a transformative journey that not only ensured swift regulatory compliance but also enhanced the firm’s FCC framework to achieve sustained solutions. Leveraging our expertise and proactive approach, we facilitated the full remediation of the firm’s framework within 10 months, resulting in no significant findings being identified by the Skilled Person and the VREQ restrictions being lifted shortly thereafter. Our strategy also enabled the firm to foster a positive relationship with the regulator and provide confidence regarding its commitment to compliance and the long-term sustainability of its improved framework.