The Business Case For Using Compliance Consultants

If you work in a financially regulated environment in the UK or US, every aspect of your business will need to be compliant to ensure that you treat customers fairly and that you avoid any punishment or prosecution from the regulator.

If you are not compliant, it means that you may not be providing a transparent service or the best thing for your customers – and this can lead to action from the regulator in the forms of fines, suspension, expulsion or even imprisonment for key members of staff.

For many regulated firms (approximately 60,000 in the UK who are regulated by the FCA) they will have an allocated compliance person in-house to oversee their compliance requirements – however, there is also a business case for using compliance consultants, who may be able to build on expertise and experience in the industry.

How Does a Compliance Consultant Work?

Compliance consultants are typically teams of people with a background in financial services, law or have worked for a regulatory body. Usually working on a monthly retainer or hourly rate, compliance companies can assist you with:

  • Setting up a regulated company
  • Legal agreements and documentation
  • Product launches
  • Advertising and marketing requirements
  • Mergers and acquisitions
  • Training staff
  • Online compliance
  • Product compliance
  • Setting up partnerships and appointed representatives

Good for Setting Up a Company

Compliance consultants may be more effective when looking to set up a regulated company, whether you plan to offer consumer finance, investments or property.

Whilst the FCA states that you can set up a regulated firm on your own, the application will usually take 12 to 18 months to be approved, but with a professional and experienced consultant, this can often be 6 to 12 months.

A consultant can help you get your application prepared and tick all the boxes so that your enquiry can be fast-tracked and approved as efficiently as possible, rather than having to wait several weeks or months for feedback and then to make amendments and start the waiting process again.

Reduce Company Risk

The potential risks of not being compliant can be dramatic. The City regulator can often give fines for poor practice and regularly removes their license from participating firms.

This can occur by not offering transparent rates, poor affordability, misleading information, failing to respond to complaints or treating customers poorly.

By having professional UK compliance consultants working with you regularly, you significantly reduce your company risk and can continue trading as normal.

Good Return on Investment

When factoring in the cost of using compliance companies, you can see the bigger picture if you are able to grow your business, make good deals and partnerships – it can be a good return on investment.

Of course you have to weigh up the cost of a monthly retainer and ongoing fees – and also having a professional in-house. Given that there may be busy times of year, you can always look at using someone on a part-time or hourly basis and avoid being tied down for long periods.

Good for Scaling a Company

If you have big plans for your company and hope to scale through hiring new staff, mergers or through advertising, having the right compliance advice can be vital. This ensures minimal interruptions or any issues arising from a lack of compliance. Hence, you are in a good position to grow your business with the knowledge that your compliance is taken care of.