The need for SMCR background checks to screen personnel in the Financial Services sector is unquestionable. Senior employees within this sector don’t just have a responsibility to their own businesses, or to their customers, their actions can have far reaching consequences across entire economies. Will Threadgill, Account Manager at Accurate, discusses the regime.
What is the SMCR?
The Senior Managers and Certification Regime (SMCR) was introduced to the Financial Services Sector in 2016 in response to the banking crisis of 2008. It rose from the work of the Parliamentary Commission for Banking Standards (PCBS) and was initially applied to personnel within banks, building societies, credit unions and PRA-designated investment firms. It was later extended to cover insurers and solo-regulated firms. The regime promotes the idea of staff taking personal responsibility for their actions, offering a code of conduct for these roles as well as determining that senior staff should undergo annual background checks.
As a baseline requirement, SMCR background checks require criminal record checks extending six years. Another requirement is that a business wishing to appoint a Senior Manager, Certified Person or Non-Executive Director must seek references from any business where that individual has worked in the last six years and, where that business is regulated by the FCA and or the PRA, such references should be regulated references. However many organisations will go further to further mitigate the risk around their organisation’s leaders. Consequently Accurate’s service in this area includes our credit checks as well as ensuring the employee concerned is appropriately registered with the Financial Conduct Authority (FCA).
How Accurate Handles SMCR Background Checks
To be SMCR compliant, the checks must be done on an annual basis, which means that an employer in the sector can be faced with the arduous and administration heavy task of keeping all their employees up to date. To help with this, Accurate offers a White Glove service that at once recognises the culture and service levels expected within the sector, while ensuring the required checks are carried out thoroughly. The service is presented through a one-to-one relationship, with Accurate providing a dedicated Account Manager and Service Delivery Co-ordinator, while the candidate will have a dedicated Candidate Screening Co-ordinator who liaises with the candidate to deliver the screening service. This work is usually through the financial organisation’s HR department where responsibility for this compliance will sit. The screening activity can therefore take place in a timely and appropriate manner with minimum disruption to the individual concerned. This is a very valued aspect of the service given how busy these employees can be.
How the SMCR Checks Process Works
Technology has helped make the screening process more efficient and less disruptive. The advent of Digital ID, for example, has reduced the disruption which can come from the screening process. Technology has also streamlined the collection and sharing of information, keeping the screening process compliant according to data rules and regulations such as GDPR. Again this takes the load away from the financial organisation’s own HR department who can therefore concentrate on more value adding tasks.
At the same time, with the appreciation of the value that a fuller screening service can offer, the SMCR has grown from a mere tick-box exercise to a more comprehensive part of risk and reputation management in the sector. Screening can unearth possible conflicts of interest or activities which could undermine the reputation of the individual and consequently their organisation.
Social media checks have become particularly important for identifying red flags around opinions held by individuals or activities which could be seen as problematic for someone holding a particular position.
SMCR UK Regulations
Ensuring senior employees comply to the SMCR is undeniably important for financial organisations, but it shouldn’t slow down the work of the business nor that of the individual concerned. Through an understanding of the sector, how organisations and individuals work and the risks involved, Accurate has designed a service that works with financial services organisations, going further than the baseline requirements to help uphold standards and give employers the security they need in their leading talent.
To find out more about the service, get in touch with our consultants at UKenquiries@accurate.com.
