Changes to the Code of Ethics

The Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (MLR 2017) came into force on 26 June 2017, with some key requirements coming into effect on 26th June 2018. AML compliance now goes far beyond the need for Customer Due Diligence.

The profession-wide Ethics Code to which we must adhere is under review, and changes to the Code are expected. The use of introducers remains contentious within the profession and IPs must chart a careful course through the provisions of the Code to meet expected professional standards. Perceived conflicts of interest remain high profile, and transparency is the buzz word of the rule makers.

The bonding regime for IPs has been under review – is it fit for purpose? How and when is it likely to change? Bonding is not the whole picture, since it interacts with other insurances, your RPB’s professional indemnity insurance requirements and the best practice requirements of SIP 11.

The Code of Ethics underpins everything we do and the long awaited revision of the Code is scheduled for implementation in early 2020. Drafts to date indicate an increased use of imperative language, more and more detailed examples of conflict situations and enhanced responsibilities placed on an IP who is an employee.

The introduction of a strengthened SIP 11 in 2018 placed increase emphasis on the need for robust financial controls within IP practices and made clear the Regulators' expectations that controls should be reviewed at least annually. But what do proportional financial controls actually look like in practice?

The introduction of a strengthened SIP 11 in 2018 placed increase emphasis on the need for robust financial controls within IP practices and made clear the Regulators' expectations that controls should be reviewed at least annually. But what do proportional financial controls actually look like in practice?