SRA or FCA? Or both? That is the big consumer credit regulation predicament that is currently challenging firms who are involved in providing legal services for consumer credit work such as credit broking, debt adjusting and debt counseling etc.
The cause of this huge dilemma was the announcement by the Solicitors Regulation Authority (SRA) in December that from 1st April 2016 the majority of legal firms involved in consumer credit work will only have to be regulated by one regulator – the SRA. They will not need to be regulated by the Financial Conduct Authority (FCA).
The quandary is that some firms will still have to be dual regulated (ie by the SRA and FCA). The main questions being – what are the criteria for dual regulation? And what must firms do in order to ensure that they don’t breach the rules?
Consequently firms who think that they may be affected by the new ruling need to check as to whether they require single or dual consumer credit regulation and to help them the SRA has produced a toolkit that will help them determine whether the work they are undertaking is covered by the SRA’s regulatory arrangements or whether they also need to apply to the FCA.
An important point to note is that the transitional arrangements end on 31st March 2016. In other words in a little over one month’s time.
If this dilemma is something you think could affect your business and you would like further clarification this link will provide access to the SRA’s toolkit, navigation tree, supporting documents and a number of case studies that are designed to help you to determine whether you need to take any action before the deadline and if so, what you should be doing next.
AFS Compliance is a cost-effective alternative to direct authorisation by the Financial Conduct Authority. As a Principal we are able to offer Appointed Representative (AR) status to suitable businesses and individuals wishing to be authorised to operate in the consumer credit market. As part of our service we constantly monitor and maintain a watchful eye on any events or changes that could affect our market and our AR’s business prospects. If you would like to discuss our Compliance Services please call us on 0844 555 5116 or complete and submit the online form that can be found on our Contact Us page.