Few people will have failed to read about the record £33.32m fine imposed on JP Morgan Securities Ltd for client money failings. As firms will be aware from past Regulatory Roundups (e.g. 8 & 15) the FSA is paying closer attention to this area.
Rowan Dartington, despite receiving less focus in the headlines, was also fined (£511K) for client money failings. Although the FSA now has a dedicated client money unit in place, both firms self-reported to the FSA after finding issues.
To quote Paul Sharma, FSA Director of Prudential Policy, “This is not rocket science. You have to separate your client assets. You have to keep proper records and you have to have a proper legal foundation for the segregation.”
Firms that hold client money may wish to review the Final Notices and compare the findings therein with their current polices and procedures.
