UK Entity of a Global Electronic Money Institution
Major Governance, Risk and Compliance Remediation Programme
February 06, 2024
FTI Consulting worked closely with an electronic money institution to establish and deliver a comprehensive remediation programme following their receipt of a Skilled Persons Report which had identified significant deficiencies and failures across the firm’s governance, risk and compliance frameworks.
FTI Consulting’s client had entered into a Voluntary Requirement (“VREQ”) with the Financial Conduct Authority, placing limitations on their business operations and was subject to a Skilled Persons review. The review identified significant deficiencies and gaps across a range of governance, risk, compliance and financial crime matters. FTI Consulting was appointed to drive remediation efforts across all aspects of the Skilled Persons Report.
FTI Consulting’s role was to support the firm in addressing all findings made by the Skilled Person, manage the regulatory engagement and ultimately design, implement and embed robust frameworks that would allow the VREQ to be lifted. We supported the firm in a variety of areas, including:
- Restructuring the firm’s governance and management oversight arrangements, including a new Board membership and committee structure, enhancing the firm’s target operating model across the first and second lines of defence, and clarifying roles, responsibilities and accountabilities across the firm.
- Designing and implementing a new risk management framework, inclusive of a comprehensive enterprise-wide risk assessment, risk appetites and risk reporting.
- Overhauling of the firm’s compliance framework and implementing a suite of new and revised policies and procedures across conduct (including preparations for the Consumer Duty), complaints, product governance, conflicts of interest and training modules as well as the firm’s compliance monitoring plan.
- Overhauling the firm’s financial crime systems and controls, spanning across all areas of anti-money laundering/counter-terrorism financing control framework (onboarding, transaction monitoring and screening), sanctions, fraud monitoring, and anti-bribery and corruption.
- Implementing of an outsourcing framework and overseeing the exiting of underperforming outsourced functions.
- Redesigning and upgrading the safeguarding framework, capital adequacy and liquidity policies and procedures.
Policies, frameworks and procedures were developed and uplifted in alignment with the firm’s size, scale and nature of its activities. Overall, our approach enabled the implementation of measurable performance improvements.
FTI Consulting helped ensure the client demonstrated its compliance to the regulator with all relevant supervisory regulations and legislations. It exhibited not only a response to the specific issues but a concrete shift to best practices.
The final stage of our work focused on implementing and embedding the enhancements we had proposed. The Skilled Person acknowledged the substantial improvements achieved by the firm in a short period of time, including not only to policies and procedures but also to the operationalisation of the firm’s approach in practice.