This is exactly the problem faced by compliance leaders who rely on an array of single-function software tools. When a regulator or auditor requests evidence, you don’t have a unified picture. Instead, you risk being left with a fragmented, “redacted” view of your compliance health – and the prospect of a stressful weekend digging through old email chains, scattered folders and archived chats to reconstruct an audit trail from scratch.

This structural imbalance was laid bare at the recent Global RegTech Summit in London. Ben Mason, CEO of My Compliance Centre, observed that single-function platforms overwhelmingly dominated the event, with the majority of vendors pitching software geared towards isolated compliance obligations.

The target for these tools is, understandably, Tier-1 institutions. But if you’re a mid-market firm, such an approach can add to rather than reduce your compliance burden. Which kind of defeats the object.

A solution better suited to Tier 2 businesses is an integrated platform that offers a comprehensive framework for all compliance functions.

The single-function trap: fixing five per cent of the problem

To provide some context, the typical UK regulated firm faces an incredibly broad mandate, managing upwards of 40 distinct compliance processes.

Naturally, firms invest in dedicated technology for their highest-profile, highest-volume risks – such as Anti-Money Laundering, transaction surveillance or client money processing. These single-function tools do their specific jobs well.

The trap, however, is believing that automation in these few areas means your entire compliance function is tech-enabled. In reality, the remaining 30 to 40 essential processes – including your SMCR framework, compliance monitoring programmes, breach registers, conflicts of interest and gifts and hospitality tracking – are left out in the cold. They continue to run entirely on manual processing, disconnected spreadsheets, emails and fragile institutional memory.

Integrated value: breadth, audit trail and evidence

Every regulatory process, no matter how small, requires three fundamental pillars to satisfy a regulator: ownership, evidence and an unassailable audit trail. Single-function solutions can degrade these pillars by siloing your data.

But an integrated compliance platform changes the dynamic across three core areas:

Breadth: It introduces a single, unified environment for the dozens of critical processes that otherwise do not have a dedicated home. This ensures no regulatory obligation is left as a manual afterthought.

A joined-up audit trail: Instead of trying to patch together disjointed timelines after an incident occurs, every single action, policy update and senior management sign-off is automatically timestamped and attributed across the entire firm.

Audit-ready evidence: When a regulator asks for proof, an integrated system lets you pull comprehensive, multi-process documentation in just a couple of clicks – not two weeks of frantic manual reconstruction.

Real-world impact: moving beyond spreadsheet scavenging

The operational strain of disjointed systems is felt daily by compliance leaders. Consider the experience of Central FX, a mid-market UK payments firm and My Compliance Centre client. As Altan Ali, Director at Central FX, points out:

“We have always carried out key compliance processes such as approving the daily client money reconciliation and monthly regulatory capital calculation. But, before My Compliance Centre, those records were scattered across emails and spreadsheets and clumsy to assemble. Today it’s a structured audit trail – reportable on demand, defensible under regulator scrutiny and much quicker to carry out.”

Strategic necessity: compliance leaders shouldn’t be squandering time on troubleshooting

When your compliance data is dispersed across single-function software tools and manual spreadsheets, the chief compliance officer risks becoming an administrative troubleshooter.

Switching to an integrated platform returns time to your senior team. Instead of spending the night before a regulator visit stressing over missing evidence or messy spreadsheets, compliance leaders can walk into board meetings with absolute confidence, backed by the latest verifiable data.

By eliminating the manual blind spots of single-function tooling, you protect your firm’s assets and elevate compliance into a strategic voice at the corporate table.

If you want to say goodbye to time-consuming data redactions and embrace a more holistic approach to compliance, talk to My Compliance Centre at Ben.mason@mycompliancecentre.com

The post Redacted: why compliance teams need solutions that provide the full picture appeared first on My Compliance Centre.

While proposals to create a “Principal Gateway” are common knowledge, the conversation about their shape moved forward significantly at the recent Association of Professional Compliance Consultants (APCC) conference in London.

Mark White, the FCA’s Head of Department for ARs, made it clear that the regulator is looking at a framework that goes beyond simple rule-setting towards a much more interventionist approach. Principals will need to provide quantifiable proof of good standards and practices.

Current state of play: where are we now?

The market is eagerly awaiting the Government’s response to the recent consultation and a formal timetable for the gateway’s implementation. But while it does, it’s worth reflecting on some of Mark’s key points to the conference.

These include the fact that although existing firms will initially be deemed to have permission to maintain their AR relationships under the new rules, this won’t equate to a free pass. The FCA will have the power to withdraw that permission wherever standards fall short.

Additionally, if the plans are fully adopted, principals will be held directly responsible for many aspects of their AR partners’ conduct, including their ongoing performance and any potential consumer harm. The Financial Ombudsman Service will also have jurisdiction over some types of complaints. To put it bluntly: the era of light-touch regulation for principals and their ARs has ended.

So, what will the reforms mean in practical terms?

Principal businesses will be required to switch from a passive, tick-box approach to compliance to active, documented oversight. Mark White’s take suggests that the FCA is no longer interested in “standard” supervision; they are looking for a forensic level of control.

Basic website checks or simple self-declarations from an AR will now be deemed insufficient, risking immediate regulatory reprimand. The FCA is looking for a robust audit trail that includes monthly attestations regarding liquidity and material business changes, as well as rigorous monitoring of financial promotions and consumer-facing materials.

Diligent principals must be able to demonstrate a deep understanding of each AR’s business model and have the data available to spot outliers or emerging risks before they manifest as systemic failures.

Tech oversight: paper no longer cuts it

Ultimately, the complexity of these new requirements means that oversight will need to be managed by more robust tools than manual spreadsheets or paper trails.

The solution is technology. And this isn’t just market sentiment; the FCA itself is actively encouraging RegTech innovation through initiatives like its own dedicated sandbox, which allows businesses to develop solutions to compliance challenges.

My Compliance Centre firmly aligns with this trend, offering digitised functionality such as monthly attestations and compliance monitoring, with the aim of empowering principals to reconcile the regulator’s expectations with operational reality.

By automating the processes that connect ARs to their principals, firms can satisfy the gateway requirements while protecting themselves from the threat of sanction, and even shutdown.

The message to the industry is crystal clear. Principals can no longer perform the role of passive actors. When the new regulations come into force, they will need to prove that they have the governance and data to justify their position of authority.

The post Spring cleaning: regulatory rebirth for principals and ARs appeared first on My Compliance Centre.

Are you among those businesses that, when it comes to compliance, view tech solutions as a luxury rather than a necessity? Are you getting by with good spreadsheets and hardworking administrators?

If you answered yes to either of those questions, I’ve got news. Today, manual processes are an efficiency-sapping liability. Let me explain.

With the need to evidence outcomes (Consumer Duty), the complexity of evolving EU and MiFID requirements and the colossal volume of data that a modern firm produces, the manual approach to compliance is an undeniable business strategy killer, whereas technology is your best defensive shield in a rapidly changing world.

Expensive mistakes: the high cost of human error

Conversations about technology often centre on efficiency, ignoring the safety benefits.

To illustrate the point, let’s consider the following credible error that could occur with a manual approach to compliance. An instruction to encash an ISA is missed because a paper form was buried on a desk. The market drops. The firm is now liable for a loss that could amount to £40,000 or £50,000.

Additionally, manual systems can create confusion around accountability. For example, where does responsibility lie for sending this or that form, and who was tasked with checking a specific file?

While these might be hypothetical scenarios, they are risks that firms face every day. Technology addresses this danger by providing an audit trail. This ensures that actions across the business are tracked and recorded, helping avoid the “I thought you were doing it” conversation.

Nothing to fear but fear itself: overcoming the overwhelm

Another barrier to tech adoption is the understandable concern about the complexity surrounding digital tools. From the modern platform economy flows a seemingly never-ending stream of jargon. The terms AI, automation, APIs and CRM integration immediately spring to mind.

However, the best way to overcome the daunting task of modernisation is to work backwards. Don’t start with the tool itself; come at it from the angle of the outcome. For example:

• Wrong approach: We need AI.
• Right approach: We need our advisers to spend 20 per cent more time with clients. What tool achieves that?

The human touch: how tech supports customer service

Fears that AI might remove the all-important personal touch in wealth management are well established. But in my view, they’re misplaced. Currently, highly skilled advisers spend hours scheduling meetings, writing up reports, scrutinising minutes and ticking off actions. None of this adds value from a client perspective.

With AI, however, a different approach is possible, and My Compliance Centre’s Boards and Committees module is a great example of that approach in action. Powered by AI, the tool can review board meeting minutes and instantly suggest follow-up actions, making oversight seamless and consistent.

Alongside this, My Compliance Centre’s Regulatory Change Management module provides real-time oversight as required by the FCA. Thanks to in-platform AI, businesses receive instant summaries of regulatory updates, which allow easy categorisation of changes, assignment of tasks and maintenance of a flawless audit trail. Colleagues are empowered to divert hours that would have been spent manually interpreting new FCA rules towards more client-beneficial activities. 

The upshot of all this is that customers get a more attentive, personalised experience, and the firm trades with the peace of mind that comes with a commercially savvy compliance strategy.

All-round benefits: from administration to user experience

Building on that last point, we are seeing firms use tech to transform the client journey entirely. Simple touches like a waiting room screen that welcomes a client by name help to set the tone of care and professionalism before a meeting even starts.

It’s hard to deliver this level of experience if your team’s time is taken up grappling with manual processes.

A hybrid future: augmenting customer care

In summary, adopting technology doesn’t mean replacing skills and knowledge. It means freeing up your experts to use their judgement.

If your management information and reporting are automated, it becomes possible to spend Board meetings discussing strategy and client meetings building stronger relationships.

In a time-poor, high-pressure environment, technology is the only lever you have left to pull that creates more capacity. And in our industry, that is the most valuable asset of all.

The post Not an option: why technology is becoming essential to modern compliance appeared first on My Compliance Centre.

A post I recently shared on LinkedIn about a hypothetical board meeting caused quite a ripple, striking a chord with more than 1,500 followers and connections.

It went something like this: I’m a compliance leader and I never want a repeat of the experience I’ve just had when presenting to my board. They spent less than five minutes on my report. There were no questions and there wasn’t even a decision on whether to accept it.

Reflecting on this meeting, it became apparent that the Board’s subdued response was my fault. I’d built a compliance function that was evidenced, monitored and regulatory-ready. Yet it was missing one vital quality: information that the Board could actually engage with.

Does this scenario sound familiar?

The gap between delivery and decision-making

In my conversations with compliance leaders across the industry, it’s a pattern I see repeated time and again. Many firms have significantly improved the structure of their compliance reporting over the last few years. They have more data, better dashboards and more frequent updates.

However, far fewer have improved the usefulness of that reporting.

This matters because boards are moving past the stage of asking “what has been done?”. Today they need to know what that data actually means for the business. They are asking questions about points of exposure, confidence levels and the availability of evidence if a regulator were to ask for it tomorrow.

So, if a compliance report is to truly play a role in driving the business forward, it needs to talk about much more than your team’s activity. It has to evolve from “noting” to “deciding”.

Turning movement into milestones

At My Compliance Centre, we’re helping businesses to bridge the gap between compliance delivery and board-level understanding through technology. Our approach represents a shift from manual, narrative-heavy reporting to automated data-led supervision.

And happily, this just happens to chime with numerous themes at this year’s Global RegTech Summit in London, with sessions set to explore topics such as the automation imperative, intelligence-led programmes and resilient regulatory change management to name but a few.

In fact, the event’s focus on data-driven oversight and real-time intelligence points exactly to where the industry is heading. Nowadays, regulators want to see the evidence of your policies in action, surfaced through insights that are accurate, actionable and easy to digest.

Joining the conversation at the RegTech Summit

I will be attending the summit on Wednesday 20th May, and I’m keen to discuss with peers how we, as an industry, can move away from reporting for reporting’s sake.

If we want our compliance functions to be seen as a value-add rather than an overhead, we have to stop presenting findings and start offering choices. We need to identify escalation triggers that the Board can agree to in advance, so that when a risk reaches them, they have the framework in place to deal with it – and information that they find engaging and, dare I say, useful.

Let’s connect

Are you attending the RegTech Summit this May? If so, I’d love to grab a coffee or find a moment between sessions to share insights on how we can make compliance reporting answer the questions the Board is actually asking.

Please feel free to contact me directly at Ben.mason@mycompliancecentre.com to let me know if you’ll be there and if you’re open to meeting. And if you want to read my LinkedIn post and join the conversation, you’ll find that here.

The post Be useful: when compliance reporting creates genuine meaning for boards appeared first on My Compliance Centre.

Consumer Duty’s implementation deadlines might have passed, and the initial flurry of fair value assessments is a distant memory. But for some firms, these rules still cause a significant amount of discomfort.

This is because Consumer Duty went way beyond other regulations in that it called for a fundamental change in mindset. It shifted the focus of compliance from a prescriptive, box-ticking approach to a world of judgement and outcomes. For those of us who like our rules to be clearcut, such ambiguity can be stressful.

However, the firms that are thriving today are those that treat Consumer Duty as an opportunity to bolster business strategy rather than yet another compliance project.

Working on the business, not in the business

The biggest hurdle for many IFAs and wealth managers is the day-to-day pressure of client delivery. When you are constantly working in the business (for example, serving clients, processing transfers, managing portfolios), it is very hard to find the headspace to develop the business.

Yet, Consumer Duty, by asking businesses to show that they understand how clients are getting good outcomes, demands a more strategic approach. In practice, this means producing evidence underpinned by data on complaints analysis and service delivery. It involves quite a bit more than simply saying “because I know my clients”.

“Selling the sizzle” to the Board

Compliance has historically, and perhaps humorously, been viewed as the “Business Prevention Department”. To move away from this kind of mindset, it’s vital that compliance leaders change how they communicate.

Innovative firms are ditching dry, 50-page Board reports, replacing them with internal podcasts or recorded video updates to deliver horizon-scanning briefings to their directors.

This is incredibly effective for two reasons: firstly, it helps busy Board members to digest the contents of the report in an efficient way; and secondly, it’s engaging, and getting leaders engaged with the process results in better business outcomes.

My advice to compliance teams is to “sell the sizzle”; don’t just report. Explain to the Board how better data on vulnerable customers helps retain assets. Explain how clear value assessments allow advisers to charge their full fees with confidence, rather than discounting out of insecurity.

The commercial reality of “outcomes”

Beyond compliance considerations, there is a tangible commercial benefit to changing the way you look at Consumer Duty.

Take the annual client review, for instance. In the past, missing this would have been considered a service error. But under Consumer Duty, if a client pays for an ongoing service and doesn’t receive it, it’s defined as a regulatory breach, with potential consequences including fee refunds for each missed year and the need to disengage the client.

The bottom line is that Consumer Duty is actually a way to build resilience. A happy client, who understands the value they receive, does not leave; and a firm that delivers what it promises does not have to refund fees.

When you view it through this lens, regulation becomes an integral part of a sustainable, valuable business roadmap. It forces you to wrap your arms around the client and ensure they are getting what they pay for. Which is exactly what good business looks like anyway.

The post Consumer Duty: a change of rules or mindset? appeared first on My Compliance Centre.

As the tax year closes, the collective sigh of relief across the wealth management sector is almost palpable. The deadline for submitting returns has passed, the allowances are used and the files are closed.

It’s at this point in the year that many chief finance officers and accountants find themselves pondering whether they have just about survived compliance requirements by the skin of their teeth, or have managed them in a proactive and strategic way.

The answer is pretty easy to deduce if you can clarify the following: surviving entails a fraught rush to complete templates and tick boxes, while managing is based on a systemic approach that satisfies the regulator and actively informs business strategy.

Based on my experience of working with businesses large and small, I’ve developed a framework for reflecting on the past year which, in turn, can help you shift from a survivor to manager footing. Crucially, it’s not about grading your homework. Rather, it’s about empowering you to improve your processes for next year.

The end of the hunch

In the past, a compliance officer or director could walk into a Board meeting with a gut feeling. Knowing where the risks were, you had a hunch about which advisers were pushing boundaries and where service levels were dipping. But this era is long since gone.

These days, confidence is built on demonstrable evidence. If you feel a specific area of the business is underperforming, you need the root cause analysis to back it up immediately. Regulators want to see proof.

With that in mind, I recommend looking at your Board packs from the last 12 months. Ask whether your management information (MI) drove decisions, or simply reported on history. If your data doesn’t enable you to spot trends like fee inconsistencies or service lags before they become complaints, it’s possible that your MI is too passive.

The danger of the “quiet period”

We are currently in a strange period of regulatory supervision. Unlike the early 1990s, where regular inspection was the norm, or the intense scrutiny of the Retail Distribution Review implementation, we are now in a phase where firms can go long periods without a direct visit from the Financial Conduct Authority.

This can create a dangerous false sense of security. It’s easy to make the mistake of thinking the regulator’s absence means your house is in order. Yet, silence does not equal approval.

However, without external audits or thematic checks, you may be marking your own homework. So, ask yourself, when was the last time a truly independent pair of eyes looked at your files? It’s well worth bringing in a third party as part of a robust culture, which demonstrates to the regulator an active approach to continual improvements.

Planning versus templates

An overreliance on templates can be an unnecessary drain on time and resources, and it is, sadly, a fact of life within many businesses. When Consumer Duty was implemented, the rapid expansion of work led many firms to grab off-the-shelf templates to ensure they were covered.

But there’s a problem with this approach. Filling in a template without understanding the why creates a disconnect, whereby files that look compliant don’t reflect the lived reality of the business. This often leads to the April panic; that is, a rush to make sure the paperwork fits the facts.

As you look at next year’s plan, ask yourself the following question: are we doing this because it’s on a checklist, or because it fits our business model? The most efficient firms are those that design their compliance framework around their specific desirability and client journey, rather than a generic standard.

Finally, I get that there is a huge temptation at the end of the tax year to shift your attention to other areas of work. But the most successful firms are those that take a few days now to review what went wrong.

If you found yourself chasing data at 11pm in March, that is a process failure, not a personnel failure. Fix the process now, and next year you won’t be racked with that niggling thought that you’ve only just survived another year.

The post Rethinking compliance performance: are you a survivor or a manager? appeared first on My Compliance Centre.

It’s a question very much driven by the creeping thicket of regulation, made ever more complex by the need to understand transnational rule variations, align with rules governing adjacent regulated sectors and decipher endless reports from international bodies and pressure groups. Each of these myriad thorny stems must be traversed with care and diligence.

Yet, while company Boards have always interrogated risk, they are increasingly aware that human capacity alone cannot manage this level of entanglement. They recognise that when rules overlap and interact exponentially, managing compliance through manual review or fragmented systems creates serious, hidden liabilities.

Consequently, the Board’s questioning has evolved from the transactional, “Have we implemented the latest regulatory update?” to something much sharper: “Given the exponential interaction of our domestic and international obligations, where are the gaps in our implementation? What is the evidence for our resilience, and if the regulator walked in tomorrow, could we prove that our filters and decision-making processes actually protect the firm?”

To put it succinctly, the core tension facing many heads of compliance today is the gap between the data they hold (activity) and the answers the Board needs (exposure).

However, this shift from “are we compliant?” to “where are we exposed?” is proving challenging for many legacy systems and manual frameworks. If your reporting system forces you into a narrow focus on the volume of work done rather than the effectiveness of your company’s and customers’ outcomes, then it might just be possible that you’re attempting to answer a question the Board is no longer asking.

Moving from annual to continuous assurance

So, how do we broaden the scope of your performance reporting?

One of the key themes of this year’s conference is ‘navigating regulatory change with confidence’. To do this without yielding to compliance fatigue, firms need to move away from quarterly and annual reporting – and fraught scrambles to collate data before Board meetings – towards continuous monitoring.

That’s because Boards now require insights that are decision-ready. Leaders need to know that if a specific risk indicator turns red, the system and the people overseeing it know exactly why, and most importantly, what is being done about it.

Without a doubt, this is the most effective way to operate in an environment where scrutiny is ongoing throughout the year. Best practice today amounts to the ability not just to trace a Board decision back to the specific data point that informed it, but also to demonstrate that appropriate steps were taken when things went wrong.

Let’s continue the conversation

The challenge of modern compliance is now about much more than clearing individual regulatory hurdles. It has become a fundamental governance issue requiring the translation of a huge volume of regulatory data into clear, actionable management information.

At My Compliance Centre, we are helping firms bridge the gap between manual activity and automated insight, ensuring that when the Board asks searching questions, compliance teams have the right answers ready.

Ben Mason, CEO and founder of My Compliance Centre, will be attending the conference on 29 April and welcomes conversations with compliance professionals about current trends and challenges facing the sector.

If you are looking to evolve your compliance capabilities to sate modern boardrooms’ appetite for rich insights, then a chat with Ben over a coffee might provide food for thought. To set up a meeting, contact Ben here: ben.mason@mycompliancecentre.com

• And if you found this article interesting, do take a look at this piece on the need for compliance professionals to add value in a complex world.

The post The Board is asking better questions. But does compliance have the tools to answer them? appeared first on My Compliance Centre.

But for ambitious firms, this is just the start. Now you’re up and running, it’s also likely that your team is working on a roadmap to grow your business. Yet while an upward sales trajectory might be your central focus, it’s vital not to lose sight of the need to scale your compliance capabilities too.

To help you with this essential endeavour, here’s what you need to know.

In practice, scaling compliance typically means three things: handling more volume, producing better evidence and keeping the Board comfortable. Crucially, this needs to be done while decoupling business growth from compliance costs. In short, you need to do more with less.

However, the cost of not preparing for this can lead to what we call “compliance debt”. This is where you rely on manual systems (spreadsheets and emails) until they become unwieldy and unmanageable – leading to risks you would not willingly tolerate. 

If you find yourself having to fix these systems while already under pressure, there’s a significant risk that important issues sit unnoticed in email inboxes, quietly evolving into major problems from the FCA’s point of view.

Why trying to scale everything is dangerous

But while the risk posed by manual processes is significant, so too is the task of trying to automate all aspects of compliance at once. The solution to this dilemma is to carefully address the most pressing areas, such as horizon scanning, internal advice management and marketing approvals, within a realistic timeframe. 

In other words, you need a ruthless prioritisation framework. At My Compliance Centre, we use a scaling decision matrix that separates the decision into two fundamental questions: Should we scale this? and Can we scale this?

Part 1: “SHOULD this scale?”

First, assess which processes are crying out for systemisation. Score your processes (0–2) against these four criteria:

1. Risk impact: If this process fails at higher volumes, what is the fallout? Is it a minor admin error, or a material regulatory breach?
2. Growth pressure: Does the workload grow linearly with the business, or faster? Some processes compound, and these become unmanageable very quickly without systemisation.
3. Evidence and traceability: How high is the scrutiny? If the Board or Regulator asks for proof, do you need a clean audit trail by default, or is informal proof acceptable?
4. Compliance debt: If you defer fixing this, how painful is the catch-up? Will it require expensive remediation and retrospective evidence creation later?

Part 2: “CAN we scale this now?”

Just because something should be scaled doesn’t mean it can be immediately. This is where many compliance teams can come unstuck – by trying to implement changes without organisational support. Score against:

1. Feasibility: Is there a quick win? Can you use an off-the-shelf solution or piggyback on an existing initiative (e.g., a wider IT upgrade)?
2. Mandate: This is critical. Do you have a sponsor? Is there a decision forum that can approve the change? Scaling usually requires cross-functional alignment. In essence, without a mandate, even the best ideas stall.

The strategy: decide your priority sequence

By plotting your processes on this matrix, your scaling roadmap becomes clear:

• High SHOULD / High CAN: Start now. These are your immediate priorities. The risk is high and the barriers to execution are low.
• High SHOULD / Low CAN: Build mandate. This is a strategic insight. The process is critical, but you lack the internal support or budget. Your immediate task isn’t to build the process but to build the business case to get the sponsor you need.
• Low SHOULD / High CAN: Only if piggybacking. If a solution comes for free as part of another project, take it. Otherwise, don’t distract yourself.
• Low SHOULD / Low CAN: Defer consciously. Document the decision and review it later.

Moving from manual to scalable

At scale, manual spreadsheets are inefficient and create jeopardy. As part of your business growth plans, it’s vital to adopt technology that makes processes repeatable (workflows, not memory), provable (evidence is captured by default) and visible (Board-ready reporting without time-consuming manual collation).

By using a matrix like the one above, it becomes possible to shift from a reactive culture to a proactive, machine-building state, which grows rather than slows your business.

Would you like to apply this to your firm? If you’d value a worked example and the full scoring sheet to help you map your own processes, please email Ben at ben.mason@mycompliancecentre.com.

The post Scaling compliance: how to prioritise when you can’t do it all at once appeared first on My Compliance Centre.

One clear sign of the Darwinian struggle taking place in today’s economy is the relentless wave of consolidation in the independent financial advisor (IFA) market.

According to data from the Financial Conduct Authority (FCA), the number of firms authorised to provide retail investment advice fell from 5,805 in February 2024 to 5,473 in February 2025. This represents a significant six percent drop in the number of companies operating in just 12 months.

Larger firms and private equity-backed consolidators are aggressively acquiring smaller IFA practices, driven by the promise of assets under management and revenue potential. However, it’s easy for buyers to overlook one critical area that can affect ambitions to grow rapidly: the state of the target firm’s compliance processes.

Exit drivers: regulatory overload

A considerable portion of the IFA owners exiting the market today belong to a generation that has seen huge regulatory change over the past two decades.

Thanks to an increasingly complex compliance environment, including recent initiatives like the Consumer Duty, many older owners are choosing to sell rather than invest the time and resources required to adapt.

In my work in compliance, it’s become clear to me that these operators are finding themselves at a crossroads, and are asking: “Do I devote my time towards working this stuff out, or do I cash out?”

This regulatory overload, which is often accompanied by an understandable resistance to change among some seasoned practitioners, means that many firms up for sale are typically operating with outdated, manual compliance systems. Spreadsheets, paper files and fragmented processes are the rule rather than the exception.

The acquirer’s headache: integrating legacy systems

For acquirers, this is a serious headache. Integrating multiple firms, each with its own disparate and often archaic compliance processes creates operational risks, increases the likelihood of compliance failures and can act as a drag on ambitions to scale.

This is why acquisitive businesses need to prioritise modern, scalable compliance infrastructure. Without it, acquirers face a daunting task: manually reconciling data, retraining staff on legacy processes, and ensuring consistent adherence to regulations across a complex new organisation.

For those consolidating everything into one system, a unified technological solution that manages compliance across a unified entity effectively is a necessity.

The value of “oven-ready” compliance infrastructure

I’ve also observed how firms that have already invested in modern compliance technology are at an advantage – and this is true whether they are looking to acquire or be acquired.

For sellers, having an “oven-ready” compliance system can enhance the attractiveness of their firm. While we can’t claim that removing this pain point from your business will increase its valuation, it is going to make it very difficult for a potential buyer to subtract from the price of your IFA business due to compliance processes.

And for acquirers, using a platform like My Compliance Centre to consolidate and manage oversight across multiple entities is essential for scaling safely and efficiently. It allows for the standardisation of processes, centralisation of data and automation of tasks, releasing valuable resources and reducing operational risk.

In summary: technology is a key component in successful consolidation

The momentum behind the IFA consolidation wave remains powerful. However, businesses that wish to take advantage of this economic opportunity need to be mindful of the pitfalls associated with outdated compliance processes.

Whether you’re looking to exit seamlessly or are working towards an ambitious growth plan, the chances of achieving an optimal IFA exit or purchase will be greatly enhanced if compliance systems that have evolved to thrive in the modern age are in place.

Sources:

Advisers flock to profession but firm numbers fall as consolidation bites

The post The IFA consolidation wave: a hidden compliance challenge no one talks about appeared first on My Compliance Centre.

There is a concept in quality assurance known as “shelfware” – manuals that are written perfectly, placed on a shelf and never looked at again until an auditor arrives.

In the payments sector, one document that could easily become shelfware is the resolution pack. These will, from May this year, sit alongside the already required wind-down plans and will aim to provide the insolvency practitioner or administrator with all the information they need to return safeguarded funds to customers. Yet while they exist to satisfy a requirement, the risk is that they will lack the “connective tissue” needed to make them usable in a crisis.

It’s for this reason that the Financial Conduct Authority (FCA) doesn’t provide a template for resolution packs. Aside from the fact that payments firms come in a huge variety of sizes and business models, the regulator wants leaders to know how to unwind their business safely through rigorous data management and testing.

The reality test

Testing is crucial to resolution packs because it elevates them from a theoretical document to a workable plan. When a crisis hits – be it a liquidity crunch or a regulatory shutdown – executives do not have time to read a 200-page static document. They need accessible, accurate and up-to-date information.

If you’re unsure about where to start with strengthening your resolution pack, a sensible step for any firm is to seek advice from an insolvency practitioner. Ask them this: “If you walked in tomorrow to wind us down, would this document actually help you?” If they can’t use it, the plan is worthless.

And there’s a good, pressing reason for doing this exercise. During 2024/25, the FCA reviewed a sample of 14 firms with e-money and payments permissions, focusing on enterprise and liquidity risk management and wind-down planning.

The regulator found that “almost all” the wind-down plans it reviewed lacked “sufficient detail, testing and validation”, and “were disconnected from the firm’s risk management framework and needed more work to be credible and operable”. It went on to say that “firms should embed wind-down planning into their risk management framework, recognising that disorderly wind-down is a key driver of harm”.

Importantly, the FCA warned that shortcomings in wind-down triggers could indicate broader issues with firms’ risk management and risk appetite frameworks. I wouldn’t be surprised if this prompted the regulator to probe other areas in some of the businesses under review.

Structure creates credibility

So, how do you transform a static resolution pack into a usable and reassuring plan?

The answer lies in data structure, and it’s where tools like PayAssure become vital. By moving away from scattered documents and towards a standardised, evidenced framework, firms can link their live operational risks (see my previous article here) directly to their wind-down triggers.

If a trigger event occurs – for example, capital drops below a certain threshold – the firm shouldn’t be scrambling to find spreadsheets. The data should be organised, standardised and ready to hand over.

The regulator’s perception

Ultimately, readiness is about credibility. The FCA knows business failure is a possibility, and isn’t looking for a guarantee of eternal success; it merely wants proof that you can fail safely without destroying customer value.

If you can demonstrate that your information is structured, up-to-date and that your wind-down plan is tied to live operational realities, you change the dynamic of the conversation. You move from a firm that is hiding behind shelfware to one that has thought through all possible doomsday scenarios.

In short, a resolution pack should be viewed as a living guide rather than a final destination. Test it, challenge it and ensure your data is ready to support it. You never know when the regulator will want to see your plans.

Sources:

Risk management and wind-down planning at e-money and payments firms – multi-firm review

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