Overview of new FCA & PRA reference proposals.
In October 2015, the Financial Conduct Authority (FCA) and Prudential Regulation Authority (PRA) set out their proposals, in their respective consultation papers ( FCA CP15/31 PRA CP36/15), for how references should be sought and given for candidates applying for a range of regulated roles. This consultation closes on 7 December 2015, with new rules coming into force in March 2016.
Two key aspects of the proposal that will impact clients operating in the financial services sector are
the increase in the number of years employment references must cover, moving from five years to six years for individuals under the new Senior Managers Regime (SMR) and certified roles.
and the introduction of a standardised regulatory reference request template.
One area that we feel the regulator has not adequately addressed is the issue of reference response times between member firms. The guidance still suggests that a reply to a regulatory reference request must be made ‘as soon as reasonably practicable’. The absence of a set time frame, e.g. fifteen working days, means that there is no sense of urgency placed on a firm to supply a reference response. When a regulated firm requires all references to be obtained before a candidate can start in their new role, delays caused by firms failing to produce references in a timely manner impacts both the firm and the candidate.
For more information please click on the link below, where a copy of the consultation paper is available to download: https://www.fca.org.uk/your-fca/documents/consultation-papers/cp15-31