Release Date: 31st March 2015
To access the original FCA document, click here.
Summary
Who was fined:
- Robert Stephan Addison, associated with Arch Financial Products LLP (AFP).
Why the FCA fined him:
- The FCA imposed a financial penalty of £200,000 on Robert Addison for breaches of the Statements of Principle for Approved Persons, specifically Principles 1 (Integrity) and 7 (Compliance with Standards).
- The FCA withdrew Addison’s approval to perform controlled functions and prohibited him from performing any function related to regulated activities.
- The breaches occurred due to failures in managing conflicts of interest, integrity issues in specific transactions, inadequate compliance monitoring procedures, and inadequate systems for managing non-public information.
Key Takeaways for Other Firms:
- Conflict Management: Ensure robust policies and procedures are in place to manage conflicts of interest. This includes proper identification, mitigation, disclosure, and record-keeping.
- Integrity in Transactions: Act with integrity in all business dealings, especially in transactions involving potential conflicts of interest.
- Compliance Monitoring: Implement an adequate, formal, and independent compliance monitoring programme to regularly report compliance issues to senior management.
- Systems and Controls: Maintain adequate systems for segregating and controlling access to non-public information.
- Leadership Responsibility: Compliance officers must take reasonable steps to ensure that necessary systems and controls are in place to meet regulatory obligations.
- Audit Trails: Maintain accurate and accessible records of steps taken to manage conflicts to establish a corporate memory and facilitate audit trails.
By adhering to these principles and ensuring robust systems and controls, firms can mitigate risks and avoid regulatory penalties.
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