advisory firm to act as their agent. We suggest that any threesixty client That other options were that acts as a discretionary manager considered & discounted. and sets up relationships with advisory That the advisory firm acting as firms on the basis that the advisory agent is in the client’s best firm is acting as ‘agent for the client’, interests. undertakes appropriate prior due diligence checks on the advisory firm. This is to ensure that the advisory firm is ‘competent’ to act on this basis and that the relationship has been set up properly. Competence Is the advisory firm competent to See above. articulate the discretionary Discretionary managers should manager’s investment undertake appropriate due diligence strategy/decisions and to ensure they are happy to accept performance clearly to the client? instructions on the basis of the advisory firm acting as agent for the client. Systems & Any decision by an advisory firm to Any decision by a discretionary controls / act as agent for a client in this way manager to apply a business model compliance should be signed off by the board / which allows advisory firms to act as monitoring partners / senior management. agent for their clients should be signed off by the board / partners / Appropriate management senior management. information should be kept of all clients set up on this basis and Where a discretionary management each file subject to review by the firm decides to operate on this basis, Compliance Oversight Function at appropriate training needs to be outset and on an ongoing basis. provided to all relevant staff. TCF Can the advisory firm evidence that Can the discretionary manager acting as agent for the client meets evidence that accepting business from the FSA’s Treating Customers Fairly advisory firms acting as agent for the principles? client meets the FSA’s Treating Customers Fairly principles? See also above in relation to due diligence checks. Information Disclosure There is a high level requirement which requires your firm to provide appropriate information in a comprehensible form to a client/potential client about: Your firm and its services; The fact that it is authorised and by whom; Methods of communication to be used; Compensation arrangements;
advisory firm to act as their agent. That other options were considered & discounted. That the advisory firm acting as agent is in the client’s best interests. We suggest that any threesixty client that acts as a discretionary manager and sets up relationships with advisory firms on the basis that the advisory firm is acting as ‘agent for the client’, undertakes appropriate prior due diligence checks on the advisory firm. This is to ensure that the advisory firm is ‘competent’ to act on this basis and that the relationship has been set up properly. Competence Is the advisory firm competent to articulate the discretionary manager’s investment strategy/decisions and performance clearly to the client? See above. Discretionary managers should undertake appropriate due diligence to ensure they are happy to accept instructions on the basis of the advisory firm acting as agent for the client. Systems & controls / compliance monitoring Any decision by an advisory firm to act as agent for a client in this way should be signed off by the board / partners / senior management. Appropriate management information should be kept of all clients set up on this basis and each file subject to review by the Compliance Oversight Function at outset and on an ongoing basis. Any decision by a discretionary manager to apply a business model which allows advisory firms to act as agent for their clients should be signed off by the board / partners / senior management. Where a discretionary management firm decides to operate on this basis, appropriate training needs to be provided to all relevant staff. TCF Can the advisory firm evidence that acting as agent for the client meets the FSA’s Treating Customers Fairly principles? Can the discretionary manager evidence that accepting business from advisory firms acting as agent for the client meets the FSA’s Treating Customers Fairly principles? See also above in relation to due diligence checks. Information Disclosure There is a high level requirement which requires your firm to provide appropriate information in a comprehensible form to a client/potential client about: Your firm and its services; The fact that it is authorised and by whom; Methods of communication to be used; Compensation arrangements;