Case Study: Managing the client's response to regulatory intervention
A skilled persons report ordered by the FSA
The Client
A major FTSE-100 financial institution with group revenues in excess of £1.7 billion, the client is the world's premier voice and electronic inter-dealer broker and provider of post-trade risk and information services.
The Challenge
The client was required by the Financial Services Authority (FSA) to commission a 'skilled persons report' under section 166 of the Financial Services and Markets Act 2000.
The report itself identified 60 findings with over 160 individual sub-findings across the governance, risk and compliance departments that required remedial action.
Each of these then formed individual work-streams as responses to the skilled persons report and evidence of their successful completion was sent to the FSA on a monthly basis.
The Solution
Worked with the firms' Board and senior management to shape, design and plan solutions for each of the findings with the output forming the firm's monthly management responses to the FSA
Produced a detailed programme plan and programme reporting structure
Developed several tracking tools for the programme deliverables to ensure accurate and timely delivery
Worked with executive and senior management to initiate the programme, build the team required and respond to initial FSA challenges on programme set-up
Lysis managed the entire programme, spanning the Governance, Risk, Compliance, Operations and IT functions, reporting to a Board-level Steering Committee
Deliverables
- Changes to global governance structures, boards, committees and legal entity governance
- Senior management remuneration
- The role and activities of the Audit Committee
- Group Policies, Delegated Authorities and escalation arrangements
- Board-level Management Information
- The role and effectiveness of NEDs
- Governance, structure and operation of the compliance function
- Global and regional compliance policies
- Arrangements for Transaction Reporting and Market Abuse detection
- Governance, structure and operation of the risk management function
- Risk management policies including ICAAP
- Design and implementation of strategic planning arrangements
The Outcome
- All milestones across the 12-month programme were achieved on time
- All deliverables (several hundred in total) were accepted by the FSA
- All changes arising from the programme were implemented and embedded as business as usual into the firm
- Confirmation from both internal audit and the appointed skilled person in their post-implementation reports that ICAP has satisfied the requirements of the S166 report
- Effective roll-out and handover to line management
Programme delivered successfully and under budget