LESSONS FROM THOSE NAMED AND SHAMED – PART 1
When reading the summaries issued by the GFSC on the enforcement action taken against these three firms, there are three reoccurring themes that jump out at you. These are failures in respect of:
- risk assessments
- ongoing and effective monitoring
- enhanced due diligence for high risk relationships.
These failures were compounded for Confiance and Provident as the issues had been raised by the GFSC at a previous visit and had not been effectively rectified.
It is very important to ensure the remediation identified by the GFSC has been implemented and I am sure much effort has been put into doing so but is it appropriate and effective? Sometimes you can read and re-read the GFSC’s letters from the last visit and hope you’ve understood what they mean. Although you have considered the remedial action identified, you’ve reviewed your procedures and you think it has all been covered, how can you be sure the changes will be effective?
It’s never too late, either, to ensure those Instructions have been followed. Like all compliant firms, you will have reviewed your files when the Instructions where issued in 2009 and 2010. However, having taken on many business relationships since then, why not take this opportunity to review your files to ensure you could confirm once again that you have continued to apply the requirements in those Instructions?
You know where I am if you need help.
In Part 2, I will look at the three themes in more detail.