Compliance Monitor

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Advisers in the London branch of UBS’s international wealth management business were able to carry out unauthorised trades in foreign exchange and precious metals using customer money for two years – between 1 January 2006 and 31..

With the exception of a knock at the door from the Financial Services Authority (FSA) Enforcement team, perhaps there can be no greater challenge for a hard-pressed Compliance Officer than to prepare their firm, and in particular its senior management, for an Advanced Risk Responsive Operating frame-Work (ARROW) visit, writes Richard Burger of Reynolds Porter Chamberlain.

The Financial Services Bill was finally published after the Queen’s Speech on 18 November. Its provisions had already been well trailed by the Chancellor, so there were no surprises. The bill seeks to address the issues raised in consultations earlier in the year in the Treasury White Paper, the Walker review on Corporate Governance and the Department for Business, Enterprise & Regulatory Reform (BERR) proposal for amendments to the Credit Consumer Act 1974. Paul Edmondson, Maxine Cupitt and Jean Price of CMS Cameron McKenna consider its meaning for the regulator and regulated.

Keir Macintosh may be contacted on tel: +44 (0) 20 7213 0772; email: macintosh@sheffieldhaworth.com. Sheffield Haworth is a leading global financial services executive search firm with offices in London, New York, Hong Kong, Tokyo, Dubai, Delhi and Mumbai

As autumn turns to winter and a general election looms ever closer, regular contributor Adam Samuel has been strangely quiet on the Conservative Party’s July White Paper on financial services regulatory reform. A compliance consultant and lawyer, who has lived through through three, and been at the cutting edge of two, structural regulatory changes for the financial services industry, he is apolitical in that he is not a member of any party and never has been. He is not, though, unpolitical. Regular readers will know that he is no fan of the Financial Services Authority. We thought that it would be good to know his views on the proposed changes to the FSA.

Bonus bashing is still in season, diverting politicians and the public. Jon Terry and Tim Wright of PricewaterhouseCoopers see an elevated role for Compliance in defining the real meaning of performance.

Unless you are a hedge fund manager it may be that you have avoided any consideration of the draft Directive. Think again! says Duncan Black of Field Fisher Waterhouse. The likelihood is your business would be affected in some way by the proposals as they currently stand – and your colleagues may begin asking you about it. Here, for the disinterested observer, is what you should know.

Philip Parish (+44 20 7296 2000, philip.parish@lovells.com) is a partner of Lovells LLP. He acts for banks and financial institutions in litigation and regulatory matters.

The global financial crisis exposed significant weaknesses in the risk management practices of many funds and banks. Investors and regulators are now demanding that the asset management industry implement far stronger risk management processes including OTC valuation, writes Dr Christian Szylar of Kinetic Partners. Their concerns are illustrated by the EU’s inclusion of requirements for funds to provide far better risk management reporting in the UCITS IV Directive and the draft Alternative Investment Fund Management (AIFM) Directive.