Compliance Roundup - 26 June 2024
26 June 2024
In this issueCSA makes recording and materials from latest Virtual Members’ Meeting available onlineThe CSA hosted its latest virtual members’ meeting on Thursday 20 June and has now made materials and a recording available online. The meeting included presentations from Frank Brown of GRR Consulting and Denise Crossley of CSA member, Lantern, discussing Consumer Duty implementation and the impending deadline for annual reviews. The meeting also included an update on the recent communication from the Financial Ombudsman Service (FOS) regarding complaints against debt purchasers. Materials and recording for this and previous member meetings are available here. CSA prepares response to FOS consultation on charging CMCsThe CSA is planning to respond next week (4 July 2024) to the Financial Ombudsman Service’s (FOS) consultation on charging case fees to claims management companies (CMCs) and other professional representatives. The key elements of the FOS’ proposals are as follows: - Successful complaints raised by a professional representative on behalf of a consumer will carry a £75 case fee for the professional representative, while the respondent firm will have to pay its full £650 case fee.
- Unsuccessful complaints raised by a professional representative on behalf of a consumer will carry a £250 case fee for the professional representative, and the respondent firm’s case fee will be reduced by £175 to £475.
- Whether a complaint is found in favour of a complainant will be based on the FOS’ interpretation that it currently uses for deciding when there has been a “change in outcome” for data publication purposes.
- Professional representatives will be afforded 3 free cases.
- Professional representatives will be invoiced their full £250 case fee upon submission of the complaint and will have 30-day payment terms.
- The FOS proposes to change the approach to the penalty for late payment of a case fee. Instead of the current £250 administrative fee, it proposes to replace this with a charge of up to 25% of the outstanding debt.
- The consultation proposed implementation of the new charges from 1 October 2024.
The CSA response is expected to include the following: - Support for the principle of charging professional representatives.
- FOS should consider applying full case fee value of £650 which seems less administratively burdensome.
- Seek clarity on the implications of the general election on implementation.
- Seek clarity on practicalities, such as what it will mean for a respondent’s case fee if the professional representative is using one of its free cases.
- Encourage FOS to consider and prepare for risk of increased activity in lead-up to implementation date.
Any members wishing to contribute to an industry response are encouraged to contact CSA head of policy, Daniel Spenceley (daniel.spenceley@csa-uk.com) as soon as possible. European Commission launches consultation on uses of AI in financial servicesThe European Commission has launched a targeted consultation aimed at informing the Commission on intended and actual application of artificial intelligence (AI) in financial services. The responses will better enable the Commission to assess market developments and risks relating to AI, as well as supporting the implementation of the EU’s AI Act. The Commission’s consultation can be found here. ICO publishes Enterprise Data StrategyThe Information Commissioner’s Office (ICO) has published its Enterprise Data Strategy following consultation earlier this year. The ICO’s Enterprise Data Strategy sets out the ICO’s approach and guiding principles for delivering its strategy. It also contains the ICO’s 2024/25 implementation plan, noting that the ICO intends to explore four foundational areas in the coming year, including data literacy and culture and data management and data governance. The Enterprise Data Strategy is available here. FOS confirms plans to continue with proactively settled complaints schemeThe Financial Ombudsman Service (FOS) has announced that it plans to continue with its proactively settled complaints scheme. It notes that the scheme affords firms the opportunity to resolve a complaint early on in the process and have it recorded as ‘proactively settled’ as opposed to ‘change in outcome’. The FOS plans to make some changes to the scheme from 24 June 2024. Those changes included that firms must make an offer within 14 days from when the case moves to investigation and making internal changes to embed the process more permanently. The FOS announcement can be found here. Business Debtline launches Building Up Business programmeBusiness Debtline has launched the Building Up Business programme. The programme has been developed with the aim of understanding more about the skills and confidence cap among lower-income small business owners and the challenges they face in navigating their business finances. Further details about the programme are set out here. ConsultationsThe following are consultation papers that are currently open for responses and may be of relevance to some or all CSA members. Also listed are papers that have recently closed to which the CSA has responded. If an industry response is warranted and you want to contribute, please contact CSA head of policy, Daniel Spenceley (daniel.spenceley@csa-uk.com). FCA: Financial Crime Guide updates
Closing date: 27 June 2024 FOS: Charging claims management companies and other professional representatives
Closing date: 4 July 2024 Review of Scotland’s debt solutions
Closing date: 18 July 2024
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