With responsibility falling firmly on employers to check for convictions and approve employees undertaking significant roles in banks, could there be an upturn in employees failing to achieve or maintain regulatory approval due to misconduct in their personal lives?

The new Senior Managers and Certification Regime (SM&CR) will come into operation this March. Initially, it will affect banks and similar businesses but later it will be rolled out to all businesses working in financial services. While the regime for approval may be changing, the FCA’s Fit and Proper Test will continue to be used in a slightly amended form to assess and approve employees who undertake key roles. 

Under the SM&CR only Senior Managers will need to be approved directly by the FCA. Employees presently designated “Approved Persons” by the FCA will instead be assessed and designated “Certified Persons” by their employer.  

Employers must ensure they have procedures in place to assess the fitness and propriety of employees. They must inform themselves of relevant matters including checking for convictions for criminal offences. 

The Fit and Proper Test involves consideration of factors relevant to an employee’s competence capability, financial soundness and also their honesty, integrity and reputation. Any conviction, however minor, may be relevant especially if it reveals a lack of personal integrity or honesty or if the person’s conduct during the investigation is questionable, or the investigation reveals a dependence on alcohol or drugs. Investigations and criminal proceedings falling short of conviction may also be perceived as relevant depending on the circumstances.

With this in mind, a criminal investigation of any nature may jeopardise the career of an employee working in financial services. It is therefore vital that anyone under criminal investigation has legal advice from a specialist solicitor as soon as possible. 

A solicitor will protect and advance your rights. They are a human face with specialist knowledge and an objective view when you may be feeling stressed, confused, under pressure or on the back foot. They will speak to the police about the allegation and evidence and advise you before any interview whether to answer questions and what facts are important to mention. They can be on the spot in the interview to look out for inappropriate methods of questioning and for further consultation.  After the interview they will help you prepare a cogent defence with supporting evidence. For less serious matters they may be able to argue that prosecution is not in the public interest or negotiate an alternative to a formal charge  such as a community resolution, caution or civil or fixed penalty.

Skilled legal representation for individuals involved in criminal investigations can make a significant difference to the outcome of the proceedings as well as future career and travel.