The FCA has released the outcome of its review of managers of authorised funds (AFMs) where investment management is delegated to a third party. These are often referred to as host AFMs or host Authorised Corporate Directors (ACDs).
While there was positive feedback in some areas, the report highlights weaknesses in governance structures, conflicts of interest management and operational controls.
The FCA view the findings as significant. If you are a manager of an FCA-authorised fund, both the press release and the full statement are essential reading. Indeed the FCA has made it clear that they expect all AFMs to take note of the content irrespective of their business model.
"The findings of this review are significant, and we intend to conduct further work to identify whether it is appropriate to make changes to our regulatory framework."
FCA Full statement