60 seconds with...Stephen Atkins

28 June 2010 | By Christine Toner

STEPHEN ATKINS
MANAGING DIRECTOR
SA COMPLIANCE MANAGEMENT

What does SA Compliance Management do?
It’s less than two years old and I set it up to provide mortgage firms with practical compliance advice from someone who has always been employed in the industry, and worked with the Financial Services Authority and the Association of Mortgage Intermediaries. We help the management teams of brokers and product providers to prepare for FSA visits, assist with post-visit action required and act as a skilled person for firms in enforcement if required. We specialise in corporate governance, risk and systems and controls advice.

Have compliance standards slipped or improved during the credit crunch?
I think standards are rising. You might not think so from the FSA’s more intrusive approach to enforcement but much of that is historic. Some firms with lower standards are no longer in the market and the survivors want to do things correctly. Directors now better understand their responsibilities although we have seen some high profile casualties at lenders.

Is compliance costly?
It can be, and it will cost more when mortgage firms are subject to CF10 compliance oversight. The FSA will argue that CF10 is nothing new and brokers should be doing it anyway, but when brokers see the list of responsibilities they will quickly realise the challenge. But any firm that keeps its standards under review should avoid the higher costs that come when special action is needed.

What advice would you give firms struggling with compliance issues?
Joining AMI is essential, as is consulting the FSA’s small firms division. Also, use the FSA website’s section on small firms as it often provides information more clearly than the Handbook. Another tip is to read the FSA’s MoneyMadeClear site. Although this is not intended for brokers it shows what customers and the FSA expect from firms. If that’s not enough, brokers should consider the appointed representative route.

What will be the biggest areas of concern for the regulator this year?
I suspect it will be the handling of arrears and repossessions, coupled with responsible lending and affordability. The Mortgage Market Review is the result of these problems. Payment protection insurance is a concern but I think MPPI will be largely untouched.
The biggest problem is how the FSA can oversee increasing lending without increasing risk.

Interview by Christine Toner