FSA announces more spot checks for small firms

FSA announces more spot checks for small firms


The FSA has said that it will guarantee the full implementation of treating customers fairly this year by conducting increased spot checks on small adviser firms.

 In the regulator’s business plan for 2009, it outlines the strategic aim to help retail consumers achieve a fair deal. The FSA has pledged to continue its programme of assessment for around 4,000 small firms, whilst stepping up other supervisory work, which will enable the City watchdog to have contact with most of the 17,000 retail firms across the country.  


Deciding to enhance its supervision strategy for small firms after worries emerged about the rising level of fraud in mortgage applications, the FSA has commented that the sample-based checks will ensure that information submitted electronically by small firms is verified.


Chief operating officer at the FSA, David Kenmir, stated: “Inevitably we are reliant on the honesty of the people completing the forms… We are going to do some sample checking to make sure the information in those returns in actually substantiated from source documentation.


“I am aware from talking to colleagues that firms have been known to submit exactly the same return on month one of the financial year as in month seven. That means either they have just made the same return, or it means miraculously nothing has changed about their business at all in any dimension in six months. We do ask questions if nothing has changed over six months.”

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