Transaction Monitoring Tuning: Balancing Detection and Noise
Transaction monitoring is only as good as its calibration. A system generating hundreds of unactionable alerts daily is not more effective than one generating ten meaningful ones — it may be less effective, because alert fatigue erodes the quality of the human review that makes …
MLR 2017 Firm-Wide Risk Assessment: Structure and Content
The firm-wide risk assessment is the foundation of every AML compliance programme. Without a well-structured, specific and regularly updated risk assessment, a firm’s AML controls — however individually sound — are built on uncertain ground that will not withstand FCA scrutiny. Regulation 18 of the …
Sanctions Screening for Payment Firms: Speed vs Accuracy
For payment firms processing thousands of transactions per day, sanctions screening creates a direct tension between two non-negotiable requirements: screening must be comprehensive enough to catch genuine matches, and it must be fast enough not to disrupt the payment processing that customers depend on. Sanctions …
Tier 1 and Tier 2 Conduct Rules: Who They Apply To
The SMCR Conduct Rules apply to virtually everyone working at an FCA-regulated firm — but they do not apply equally. The distinction between Tier 1 (Individual Conduct Rules) and Tier 2 (Senior Manager Conduct Rules) determines what each person is required to do and, critically, …
Reasonable Steps Under SMCR: What the FCA Looks For
“Reasonable steps” is the central concept of SMCR personal accountability — and the FCA’s track record in enforcement shows exactly what it means in practice. This is not an abstract standard. The FCA assesses it against concrete questions about what the SMF holder knew, what …
Statement of Responsibilities: Drafting Tips for New SMFs
The Statement of Responsibilities is the document that defines what you are personally accountable for as a Senior Manager. Done well, it protects you and the firm. Done poorly, it creates ambiguity that the FCA will exploit if something goes wrong. Every proposed SMF holder …
Annual Certification: Practical Steps for Certified Persons
Annual certification is a genuine compliance obligation — not a bureaucratic formality. Firms that treat it as a tick-box exercise, and individuals who wait passively for their employer to manage it for them, both regularly find themselves in difficulty when the FCA asks questions. Under …
Senior manager handover: best practice when SMFs leave
Senior manager handover: best practice when SMFs leave When a Senior Manager leaves an FCA-regulated firm, the event triggers a series of regulatory and governance obligations that go significantly beyond a standard employment notice period and handover. The departing senior manager must be withdrawn from …
SMF24 in growing firms: why the Chief Operations Function matters
SMF24 in growing firms: why the Chief Operations Function matters The SMF24 Chief Operations Function is one of the less prominent Senior Manager designations — less widely discussed than the SMF2 CFO function or the SMF16 compliance oversight role, and less specifically defined in the …
Allocating Prescribed Responsibilities by Firm Type
Allocation of Prescribed Responsibilities: practical examples by firm type Prescribed Responsibilities are specific regulatory obligations that the FCA requires to be allocated to a named Senior Manager in every FCA-regulated firm. Unlike the Senior Manager Functions themselves — which define the areas a senior manager …
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