Credit Broking Websites and Social Media

 

The rules are simple – you must be “clear, fair and not misleading” if you promote finance as part of your services to customers.

As a result of our work with car dealerships, credit brokers and unsecured lenders within the motor sector, we frequently come across dealerships that have live websites and / or a range of social media posts promoting finance.

Here are some tips to consider when you’re working on building your website and / or planning your social media strategy for the promotion of finance:

• There’s nothing clever about producing a financial promotion, just the age-old rule of ensuring that it’s clear, fair and not misleading. Check that what – and how you promote finance to your customers is based on information you’d be comfortable responding to if you were the customer.
• Each financial promotion is unique. Although the rules are static, subjectivity is in abundance, for example in respect of ‘prominent’ key information. It’s not just about what you say but where and how information is placed within the promotion itself that’s important.
• Ensure that the individuals responsible for the content of your financial promotions are fully trained in respect of the rules and that your firm follows  a compliant review, approval, sign off and monitoring process for all of the financial promotions it produces.
• Due your due diligence before your website content is designed by a third party media firm. Make sure that the firm has a good understanding of the financial promotions rules. We spend a significant amount of time providing feedback to firms that have had a website built, only to find that the content is not compliant. Hence, a re-work of content and additional cost to the firm.
• ‘Vulnerable Customers’ is a relatively new term used within the Financial Services sector. The Financial Conduct Authority has made it clear that vulnerable individuals must be taken into consideration. Always be mindful of your target audience and whether the message you send to them via a financial promotion is appropriate.

So, what’s new in financial promotions? The surge of social media usage for marketing purposes has been a challenge for firms. This is a smart way for firms to promote their services, but it has to be done right. The Financial Conduct Authority has issued specific guidance as a result of the confusion in this area. And it’s not easy figure it out. If you’re not confident, then stay away, or obtain some proper training on how to promote finance on social media in a compliant manner.

There are, of course, other regulatory bodies to consider as well as the Financial Conduct Authority. For example the Information Commissioner and the Advertising Standards Authority. Make sure that you refresh your knowledge of these Regulators and their requirements.

The main challenge that firms appear to have is that they ‘don’t know what they don’t know’. This means that they act with good intentions, but without the knowledge and experience to be able to make sound judgments.

Our advice is stick to what you know. Don’t try anything exotic unless you have appropriate understanding of the rules around it. This will reduce your firm’s risk of running a non-compliant financial promotion that could negate any commercial gain your firm might seek to make.

To get your advertising right, you need to:

• Know and follow the rules for the promotion of credit broking. These rules can be found within CONC 3.
• Follow your own understanding of how to apply the rules. Don’t copy another firm’s website or social media post!

If you’re in any doubt and you want to have a chat about your website or social media posts and how to promote finance, give us a call on 01376 514 166, email us at julie@chameleoncompliance.co.uk or visit our website http://www.chameleoncompliance.co.uk.

 

‘Sales’ Versus ‘Compliance’

Strolling through social media earlier this week, I came across someone who specified their role title as ‘Sales & Marketing Compliance Manager’. I pricked up my ears as this is such an unusual job title. Sales / Marketing and Compliance tend to be seen as the ‘chalk and cheese’ of financial services and are often seen to rub each other up the wrong way.

We’re sometimes contacted by firms that ask for our help to put things right. When we drill down to find where the issues started, we discover that it’s often down to the ‘sales versus compliance’ culture. There is low-lying disharmony and an ‘us versus them’ feel as soon as we walk through the door.

So, how to work better together? It’s all very well suggesting that you sit down over coffee and ‘talk it out’, but does that really work?

Here are some tips to help you to have a more harmonious working relationship that works for everyone:

1. Find the common denominator. Sales / Marketing and Compliance both want to be praised and rewarded for their performance. Both want recognition for the hard work they put in to make the company a success. Both want the company to do well.

2. Recognise the mutual relationship you have. Neither role can exist without the other and each one has an important role to play in the success of any business operation.

3. Compliance is sometimes called the ‘Business Prevention Unit’ and Sales / Marketing roles are chastised by compliance teams for wanting to do things in their own way to bring in business. That kind of thinking has to stop. Instead, spend ‘a day in the life of’ – shadow each other for a day. It’s likely that will be all you need to set the record straight, because this exercise will give you important insight into the challenges that each role faces on a daily basis. Call it mutual respect, if you will.

4. Ask each other what you can to do help the other and agree on just one thing that you will both change.

5. Now that you’ve had some time to think, arrange to meet on a regular basis to listen and to talk to each other. What’s working? What isn’t? What could be improved?

If you want us to help you to get your conversations started, you can contact us via our website www.chameleoncompliance.co.uk, telephone 07880 483 806, or email us at enquiries@chameleoncompliance.co.uk.

 

 

Due diligence – it’s like buying a new car

I bought my first car the other day. I went to the first dealership I came across and I told the dealer what kind of car I wanted. I asked them to sell me a car of that description at the price I wanted to pay. I didn’t have time to ask questions, or to haggle and I walked away with a new mini, 2002 plate for £20,000 with £100,000 miles on the clock. The dealer was great and even threw in some floor mats for me. I’m happy as pie because I got what I wanted.

Is this the best way to go about buying a car? I don’t think so.

If I were to have done my homework, I would have asked about windscreen price, spec, marque of car, mileage and mileage type, number of previous owners, added extras, warranty, free servicing & roadside assistance – the list goes on. And I wouldn’t have checked out just one car at only one dealership.

Likewise, the FCA expects all authorised firms to do their due diligence when forging new third party business relationships, recommending providers and products on behalf of their clients and so on.

So what does this mean in practice? It means looking at the options available, making a comparison to make sure that what you get is quality and that it is what you’re actually looking for.

Having a due diligence process that fits the bill for each type of third party relationship or research that you need to conduct is vital to consistency and for covering all bases. All too often we come across firms who firmly believe that they are conducting due diligence when in reality they’re conducting a tick-box exercise that doesn’t do the job.

So don’t end up with a 15 year old car at £20,000 and get in touch with us if you’d like our assistance at http://www.chameleoncompliance.co.uk, telephone 01778 483 806, or email us at enquiries@chameleoncompliance.co.uk.

Business Risk – No Problem

Last week’s shocking detail released about the events concerning the Alton Towers court case is one that we never want to hear again.

What struck me, apart from the victims’ bravery and strength in these recent months, was how the owner of Alton Towers handled the matter from day one and how very unprepared they were for a disaster like this to happen.

We tend to think that we have the boxes ticked in respect of our systems and controls – particularly and in this case, our business continuity and disaster recovery plans, but in reality, how do they stack up? Within the financial services environment we clearly don’t need to have the same level of concern over personal health and safety like Alton Towers, but what about the safety and the management of risk in other areas of our businesses?

Do you operate a tick box exercise where you want to cover your back – ‘just in case’, or do you make these systems and controls real and aligned to your own business?   Here are 5 tips to help your thought processes on this matter.

1. The FCA categorises risk into a variety of areas e.g. prudential risk, conduct risk, reputational risk etc. As a senior management team, brainstorm how each of these areas can be applied to your own business model.

2. Think big and then start to categorise these areas from the macro- ‘out of your own control’ type of risks (e.g. economic breakdown of the economy, lightening striking the office building), then drilling down to the detail of risk within your own business.

3. Think about the fact that you run a business – what kinds of risks do you face as a business? Cashflow, startup costs, human resource, product mix? Just a few areas to consider.

4. Now consider the fact that you are a regulated firm. What additional risks do you, as a business have at this level? (e.g. Advisers not competent? Systems & Controls not rock solid?).

5. Consider the operational departments within your business and the variety of functions within it. Ask your teams to conduct a departmental risk analysis. These people know their jobs better than you, so they will be able to identify the kinds of risks that might be off your radar.

6. Are there any key functions / individuals within the business that need to be considered? Do you have succession plans in place? Relevant insurances etc?

If you carry out the above analysis, you’ll be well on your way to the provision of a valuable insight into current risk levels within your firm.

The results of this analysis are not meant to be left on the shelf. Their purpose is to act as a starting point to a work in progress, so that at any one point in time you are able to see how your business is willing to carry risk and at what level of impact and probability.

If you think you might need some help, get in touch with us via our website www.chameleoncompliance.co.uk, telephone 07880 483 806, or email us at enquiries@chameleoncompliance.co.uk.

 

 

 

 

 

 

 

Now that you’re FCA authorised

If you are a recently FCA authorised firm, you may feel rather relieved in the knowledge that you’re finally ‘over the line’. This feeling will apply whether you’re an IFA, a mortgage, general insurance intermediary or credit broker, amongst others.

Over recent months, you’ve spent days in the Boardroom, your weekends and evenings working on responses to the FCA’s interrogation of your application. And now, it’s all over – PHEW!. . . Or is it?

You may have been so focused on the application and authorisation process during recent months that what you do with ‘compliance’ now that you’re authorised may not have even crossed your mind. If it has, then despite all good intentions, you’re probably desperate to get back to ‘business as usual’ – with a niggling feeling that maybe you should be doing more ‘compliance’ on a day-to-day basis.

Tips for ongoing compliance

 To make compliance work for your business, then you may need to take a step back and apply what might be a different approach to your business operation.

Send out a survey to your staff – find out what they like about working for you, what they don’t and why. Find out what kinds of improvements they would make to their own roles if they could – and why. Gather their ideas, their concerns and their observations about what works and what doesn’t – and why.

Take these results, analyse them and take them into your next formal senior management meeting. What do they tell you? Are you running too tight a ship? Do your staff lack direction? Do they like working for you? What are they most worried about?

Think about the FCA’s focus on treating customers fairly – that means your customers AND your staff – is there anything within the staff feedback that makes you sit up and think? Your staff are your most valuable asset, so ask them for their help. They know your customers better than you. They know your processes better than you and they know how to make compliance work within your business, right at the coalface.

Regular ongoing changes to Financial Services regulation time and time again present the same issues for firms to manage. One of these issues is that senior management need to learn how to manage their teams ‘FCA style’ and to engage compliance at the heart of their business operations.

It can be a ‘tough love’ experience to make compliance work on a day to day basis, there may even be initial resistance from some of your team, but once your compliance framework is in place, there’ll be no stopping you! With the right framework your team will drive compliance for you – enjoying the level of structure and control they are able to exert over their own roles, their own results and ultimately the profitability of the business.

If you want to find out more about how to engage your team and your customers and to make your business compliant, give us a call on 01376 514 166. Alternatively, you can email Julie@chameleoncompliance.co.uk.

 

 

 

 

 

5 website FCA compliance tips for debt management firms

The majority of firms that approach us have had difficulty bringing their websites in line to make them ‘FCA compliant’. If your firm is doing its best to be compliance friendly, here are a few tips to help you:

1. Ask a friend or family member who is not involved with your business to look at your website. Ask them what impression they get about your firm when they scan from page to page.

2. Does your website explain what the firm does and what it doesn’t do? How clear is the content on each page? Does each page contain a specific set of information that is clearly presented for visitors to read and to understand?

3. Think about the information you provide about your services and products. Do you include the risks and potential negative aspects about each option available to customers, as well as the benefits?

4. Do you signpost to the ‘Money Advice Service’ and is this message displayed prominently on your website?

5. Go to the FCA website at http://www.fca.org.uk and review the relevant rules in ‘CONC’. You will find all you need to know about how to produce a compliant website for debt management.

If you want to check the compliance of your website against FCA rules, give us a call on 01376 514 166 or visit our website.

Debt Management and FCA Compliance

Generally speaking, debt management firms have had it tough recently.

With the FCA application process for debt management firms still progressing, it’s ‘all eyes down’ for debt management firms.

Business owners and senior management have been expected to bring their business practices and operational processes in line with FCA compliance for some months now and our experience to date tells us they’re still struggling.

If you’re a debt management firm, the FCA’s Thematic Review paper, “TR15/8: Quality of debt management advice” will give you all the clues as to how to be an FCA compliant firm as a baseline, for debt management.

For more guidance on how to ensure that your firm has compliance at the heart of the debt advice that it provides to its customers, go to the FCA website at http://www.fca.org.uk or give us a call on 01376 514 166.

Warts and All

When was the last time someone told you the absolute truth… about you? Seriously… Warts and all?

This is quite a daunting question for most people because however well we think we know ourselves and however good our standing in the outside world, we can’t see what we can’t see by looking out from our own perspective.

As an FCA authorised firm, having the right Compliance Consultant is a bit like choosing your best friend:

Do you want a friend who is going to tell you only what you want to hear and leave you to the mercy of the wider world and to the FCA? Or do you want someone who is not only good to be around but is also ‘watching out for you’ and telling you not just what you want to hear but need to hear?

Seeking external Compliance Consultancy that will support your firm to attain and / or maintain its FCA authorisation might seem a little out of the ordinary at first, and yet it is often the best ‘health check’ that you can give your business. This is because it means having a dialogue with someone to help to understand the whole of your business – your structure, your people, your strategy for future business growth and change – in short, it’s the friend you hoped your business would always have.

Compliance staff within your business will usually make sure that your policies and procedures are set up and reviewed and that things are being actioned; they can help to ‘police’ your business. But a good Compliance Consultant will proactively make sure that the right things are being actioned, proactively managed and that you focus your business efforts in all the right places. After all, you want to ensure that in the eyes of the FCA and the Financial Services community at large, you are an examplar member of the business community.

Now, who wouldn’t want a friend like that?

Consumer Credit – what do I need to do now?

Is there anything to worry about? Whether you’re new to Consumer Credit regulation, or whether you’re new to the FCA regulatory environment, you have a multitude of changes ahead.  There’s nothing to worry about, as long as you plan ahead and put the work in to ensure that your firm is a solid structure with excellent documented systems and controls in place and the right expertise to help you where and when it’s needed.

The first step – your Business Plan If you haven’t done anything yet, start to consider your Business Plan.  A Business Plan for submission to the FCA is not entirely the same as the Plan that you would submit to your business bank manager.  The FCA is looking for you as a firm to acknowledge and understand the regulatory environment and to encompass this as the very foundation of your thinking.

Can I use a generic template? Whether you are the owner of a small or large firm, you will not be expected to submit a plan that is clearly not designed for your business.  Templates are fine in terms of use as a skeletal structure; to get you thinking and to get you started in committing pen to paper, but that’s all.  This is your business and your own vision and projection of how the business stands currently and how it is envisaged to grow over time. So, give it time. The time that you spend now will be invaluable later on, when you revisit and review your business Plan on a regular basis.  It is ultimately a working document that will help you to keep focused on your goals and provide a springboard for discussion amongst senior management on a regular basis.

Why is this important and what should I do now? The FCA is keen to understand your business and in reviewing your Business Plan, it should be able to gain a clear picture about your business.  Read the FCA website and follow its guidance on what to include.  You may already have the required content in writing so now is the time to ask yourself what your staff think about it.  Do they understand it? Do you invite them to contribute their opinions? Do they have any questions about the current content? Do they have any suggestions on how to improve it? If you’d like any additional guidance on writing your Business Plan, we’re happy to chat through our thoughts with you, so please feel free to give us a call or drop us a line via our website http://www.chameleoncompliance.co.uk

Julie Ampadu.