Regulatory references

The FCA require firms to request a reference from Senior Management and Certification Function candidates’ past employers - known as ‘regulatory references’. (This will also apply to Non-Executive Directors, who are not Senior Managers).

The proposed rules in relation to regulatory references largely echo the rules issued by the PRA and FCA on 28 September 2016 in relation to the regime for banks and which came into effect on 07 March 2017. Read in full here. Other firms have been subject to an interim set of rules since then.

The rules require firms to request a reference from all previous employers in the last six years for relevant candidates, share information in a standard template, and to disclose information relevant to assessing whether a candidate is fit and proper covering the previous six years.

Firms will need to revisit their policies and practices in relation to references. In particular, will need to consider their policies for giving references as well as the implications for conduct of disciplinary and quasi-disciplinary situations. The new rules are unlikely to satisfy the firms which are concerned about the risk of “rolling bad apples”. Equally, some ambiguity around what firms are required to provide will give rise to uncertainty until industry practice takes shape.

This document (and any information accessed through links in this document) is provided for information purposes only and does not constitute legal advice. Professional legal advice should be obtained before taking or refraining from any action as a result of the contents of this document.