Empowering our clients for a Section 166 Review

Most firms will be aware of the regulators’ “box” of supervisory tools, especially the one described under Section 166 (S166) of the Financial Services and Markets Act (FSMA 2000) that gives the Financial Conduct Authority (FCA) and Prudential Regulation Authority (PRA) the power to commission reports by “Skilled Persons” to obtain a view of any aspect of a firm’s activities. A “Skilled Person” review is an independent review of a regulated firm, usually focusing on specific issues where the regulator wishes to investigate a firm’s activities.

A Section 166 review can be a very intrusive and disruptive process with severe consequences. Therefore, it is crucial that firms respond to the S166 Requirements Notice in a timely manner and liaise appropriately with the regulator during the process.

Lysis Group understands the challenges during each step of a Section 166 review and draws on an experienced team of highly skilled individuals who comprehend the scope of the review and the reviewer’s and regulator’s expectations. We recognise that prompt and effective action is fundamental to our clients' businesses and their relationships with regulators and prosecuting authorities.

Our experienced team can deliver accurate, swift, and incisive analysis of challenges, and our Operational Support Team provides flexible and cost-effective solutions for frameworks, policies and procedures, customer files and document reviews and remediation following the review.

Knowing what the expect

The S166 investigation is carried out at the expense of the firm, but on behalf of the regulator and almost always results in a comprehensive list of findings and requirements. Responding in the correct manner will determine:

• The level of future supervision.
• Whether enforcement actions will be taken against the firm or individuals and will determine?if a post S166 review will be conducted.

Knowing what to expect from a Section 166 review and preparing for the journey can be a deciding factor in making the process less arduous and ensuring the best possible outcome. To understand the challenges presented within each stage of a Section 166 review will enable firms to stay in control. The outcome of the review will have a lasting effect. Taking positive steps to not leave anything to chance will pay off in the long run.

Averting regulatory penalties

Lysis Group prides itself on helping firms to avert regulatory penalties and to make long-term operational changes that will prevent future penalties. We do this by working closely with firms’ senior executives and with the FCA to ensure that the most pragmatic solutions are found to achieve compliance.

Beginning with an initial discovery phase, we work with your firm to understand and identify the gaps before setting out the steps to build the necessary capabilities and embedded processes needed for a sustainable solution. Each phase of the process is structured to meet key milestones and deliver specified outcomes in a cost-effective manner, within the given time frames.

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Lysis Group can provide the following:

• Structured and experienced responses to regulatory interventions.
• A full and detailed analysis of a firm’s current situation.
• Expert and experienced support and guidance.
• Gap analysis and a clear change roadmap.
• Templated and packaged responses to each remedial action taken.
• Delivery of all regulatory recommendations.
• Removal from the watch list and a return to a normalised footing with the regulator.
• Improved operational framework and strategy execution that can impact the bottom line of a firm positively.