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FSA in the spotlight: Dealers must achieve TCF

In the last couple of months the FSA website has all but overflowed with new guidance, consultation and discussion papers.

All dealers, irrelevant of their size or level of regulated income, must comply. Dealer principals need to consider the following:

  • Understand what the FSA’s move to ‘principles-based regulation’ means for the firm.

    Principles-based regulation is coming. The FSA is responding to the requirement to reduce red tape and the burdens of over-regulation by reducing the number of rules in its handbook.

    To achieve this the FSA is creating a framework within which companies can operate and the boundary of this framework is made up of various obligations, commitments, responsibilities and the FSA’s own principles.

  • Ensure the company meets the FSA Treating Customers Fairly (TCF) deadline.

    The FSA is also consulting on responsibilities for distributors, which includes car retailers.

    This consultation ends on December 29 and will be published in the New Year. The proposed responsibilities are:

  • Understand information given by the provider. If not clear, question the provider and consider whether to distribute the product
  • Fully consider the customer’s needs and circumstances, so that the product can be properly matched to the customer
  • Post-sale service must be consistent with that the customer has been led to expect All of this is intended to create a climate within regulated firms for TCF. No regulated firm is too small to avoid TCF.

    The FSA has set a deadline of the end of March by which all firms must have gone a significant way towards implementing their TCF strategy.

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