UK:
UK Financial Conduct Authority Fines Aviva For Client Asset And Money Failings
01 November 2016
Shearman & Sterling LLP
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On October 5, 2016, the FCA published the final notice issued to
Aviva Pension Trustees UK Limited and Aviva Wrap UK Limited, fining
the firms £8,246,800 for failing to have adequate controls
and oversight arrangements to effectively control the outsourcing
of administration of client money and external reconciliations of
custody assets to Third Party Administrators and for failing to
arrange adequate protection for client money and safe custody
assets for which they were responsible. The FCA's Client Assets
Sourcebook (CASS) rules aim to protect client money and custody
assets if a firm becomes insolvent. Where a firm outsources its
client asset and money administration, it remains responsible for
ensuring that the FCA's rules are complied with. Whilst in this
instance there was no loss of client money, the FCA deemed the
failings to be especially serious, given that Aviva's annual
external CASS reports had identified the breaches for consecutive
years.
The FCA's final notice is available at: https://www.fca.org.uk/publication/final-notices/aviva-pension-trustees-uk-limited-aviva-wrap-uk-limited.pdf.
The content of this article is intended to provide a general
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