• Gordon McMurray

How to pull authorisation out of a hat

It may sound trite, to compare applying for authorisation to a magic trick. But if you’re under any illusion that less-than-perfect preparation is good enough, take heed. Says Sarah Rapson, director of authorisations at the FCA: “We have begun to take a harder line on submissions that border on the vexatious.”

Of course, it’s hard to know what others consider vexatious. It could be anything from mildly irritating to properly annoying or downright exasperating. If indeed there’s a scale of vexation. Fortunately, the FCA has given us a few clues.

When assessing an application, your case officer is essentially considering three things.

First, they look for indications of what you’ve done when preparing your application. So they want to know things like whether you’ve read the information on the FCA website, made enquiries of the contact centre, or sought legal or compliance advice. They also judge you on how clearly you’re able to articulate your regulatory obligations.

Second, they consider your attitude during the application process. (I’m sure they didn’t mean that to sound quite the way it does – conjuring up images of the ‘naughty step’, detention or, for those old enough to remember, the strap!) They judge whether you’re being open and honest with them and proactive about getting information to them. They also want to see that you understand your regulatory obligations and respond quickly to any questions they have about your application.

Third, they want to be sure you have your supporting documentation prepared and arrangements in place to comply from the day you’re authorised. So they consider why you’re applying now, what’s still outstanding that would stop you from doing whatever you’ve applied for, and whether you’d be able to do that activity if you were authorised straightaway.

You need to pass all three of these ‘tests’. It’s not enough, for example, to be willing to correct mistakes or gaps in your application if you fell over at the first hurdle. Quite clearly, they’d find this vexing!

“We will move to refuse firms earlier on in the authorisation process where the firm is not ‘ready, willing and organised’ to operate in the regulated financial services market,” Rapson says.

And those are the magic words: ready, willing and organised. From the day they receive your application, and throughout the process, they want to be sure you’re ready, willing and organised to comply with the rules and requirements at all times.

If you find the process all a bit hocus-pocus, just contact ComplianceWizard and we’ll help you pull it off. Sorry, out. (Of the hat, that is!)