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.

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