MMR: Time is running out!

28 March 2014

Compliance expert Ray Cohen has compiled an emergency survivor’s guide in light of the oncoming regulation changes to minimise the chance of any nasty surprises.
Changes to be made by: 1st April 
Update your stationery, website, emails etc. to cover the fact that you are now authorised and regulated by the Financial Conduct Authority and not the OFT with effect from 1st April.
Make sure you have applied for your interim permissions/ variation of permissions for Consumer Credit Activities.
Amend your high-net-worth and predominantly for business purposes documentation, for loans post 1st April.
If you do Consumer Credit (CC) loans make sure your documents have been updated in line with the regulatory changes.
If you have decided not to keep your CC licence make sure you apply to the FCA for AML Supervision.
Changes to be made by: 26th April 
If you are a small lender, apply for a modification by consent now to defer the application of the new capital adequacy requirements and reporting regime.
Make sure you understand the rules on giving advice and execution only and make any changes to your processes. Make sure you have the right permissions as well. If you are no longer going to sell direct, don’t forget to give up your permissions.
You should have your new MMR compliant policies and procedures in place and be training your staff.  Remember that if you want to do extensions on an execution only basis, you cannot encourage people to opt out of advice, so promoting an execution only offering may fall foul of the rules.
Consider if you are going to make use of high-net-worth and 100 per cent for business purposes tailored provisions and adjust your policies accordingly. You may be able to use these for terms over 12 months but they won’t be classed as a bridging loan.
Remember that a bridging loan can only be written with a maximum 12 month term.
If you haven’t already, start planning for the new Product Sales Data and Performance reporting starting from 2015.
You really need to consider automation of data capture and submission to avoid significant time and cost spent on manual reporting.