Fitness & Probity
We will design and implement a Fitness and Probity framework appropriate to your business.
McCole & Co. Consultants also provides CPD accredited training to ensure your staff understand the Central Bank’s Fitness and Probity Regime.
DO YOU HAVE A COMPREHENSIVE FITNESS & PROBITY REGIME?
If you do not have a Fitness & Probity framework in place, or need to review your current framework, let us help you to design and implement one that is relevant to the scale of your business.
INCREASED REGULATORY FOCUS ON FITNESS & PROBITY
The Central Bank recently issued a ‘Dear CEO’ letter reminding all regulated firms of their extensive obligations under the fitness and probity regime. The Central Bank issued this letter as it noted a lack of general awareness in the industry regarding the scope of the Fitness and Probity Regime, particularly as to the extent of a firm’s own legal obligations.
HOW CAN WE HELP?
Do not be surprised to receive follow-up correspondence from the Central Bank requesting you to demonstrate how the issues raised in the ‘Dear CEO’ letter have been considered and to explain and evidence any remedial action taken.
We will review your firm’s fitness and probity policies, procedures and practices and address any shortcomings.
HAVE YOU NOTIFIED THE CENTRAL BANK PRIOR TO MAKING A SENIOR APPOINTMENT?
Before your firm appoints a person to certain senior positions known as PCF roles, it is important that you notify the Central Bank and receive its formal written approval for the appointment.
McCole & Co. Consultants are very experienced at guiding individuals through each step of the approval process. We are happy to discuss each stage of the process with you and provide advice in relation to the Central Bank’s expectations regarding each proposed appointment.
Frequently Asked Questions (FAQs)
What is a Controlled Function (CF)?
A Controlled Function (‘CF’) is a function in relation to the provision of a financial service which is prescribed by the Regulations as a CF. Please find a list of CF roles here
What is a Pre-Approval Controlled Function (PCF)?
PCFs are a sub-set of CFs which by virtue of the nature of the role require the preapproval of the Central Bank. PCF roles are performed by senior individuals in a regulated financial services provider. Please find a list of PCF roles here
IF AN INDIVIDUAL PERFORMS A CF, WHAT DOES THIS ENTAIL FOR THAT INDIVIDUAL?
If an individual is performing functions which fall within the definition of one or more of the CFs (CF1-11), that individual is subject to the Central Bank’s powers under the F & P Regime. The practical implication of this includes that the individual:
- Must comply with the F & P Standards;
- Must agree in writing to abide by the F & P Standards issued under Section 50 of the Act;
iii. Must provide the firm with the required information to enable it to conduct the appropriate due diligence
- May be the subject of an investigation where the Central Bank has reason to suspect that person’s fitness and probity to perform the relevant CF, and decides in the circumstances that an investigation is merited;
- May be required to comply with an evidentiary notice;
- May be the subject of a suspension notice or a prohibition notice.
Where an individual is captured by the Minimum Competency Code (‘MCC’) with respect to CF3-9 then that individual must comply with the MCC.
An individual performing a CF is not required to submit an IQ to the Central Bank in relation to the performance of those CFs.
WHAT ARE THE OBLIGATIONS ON THE FIRM IN RELATION TO THOSE INDIVIDUALS CAPTURED BY THE DEFINITION OF A CF?
If an individual is performing functions which fall within the definition of one or more of the CFs (CF1-11), practical implications for the firm may include:
- It must satisfy itself on reasonable grounds that the individual complies with the F & P Standards.
- It must get written confirmation from those individuals performing CFs that they will comply with the F & P Standards;
iii. It cannot permit a person to perform a CF unless satisfied on reasonable grounds that the person is compliant with the F & P Standards;
- Where the CF is or has been the subject of an investigation, the firm may have to:
- comply with a suspension notice (See Section 27 of the Act);
- comply with an evidentiary notice; or
- comply with a prohibition notice.
CAN AN INDIVIDUAL BE APPOINTED TO A PCF ROLE WITHOUT THE WRITTEN APPROVAL OF THE CENTRAL BANK?
No. A firm must not offer to appoint a person to perform a PCF role unless the Central Bank has approved, in writing, the appointment of the person to perform the function. However, the Central Bank is satisfied that a firm can inform a person of an intention to offer the person a position which is a PCF if it is made clear that the actual offer is subject to receiving the Central Bank’s prior approval in writing of the appointment of the person to perform the function.