‘Skilled person reviews’ – 2023 data published

The FCA has published the list of skilled persons reports in 2023. In total, there were 29 reports commissioned across various ‘LOTS’.  

Between Q1 and Q2 of 2023/4, the number of commissioned reports increased by 64%. In one area alone, Controls and Risk Management Frameworks, the number of reports commissioned almost trebled over the same period. Firms should not take these warnings lightly. Prevention, in this instance, is immeasurably preferable, and considerably cheaper, than cure.

About ‘Skilled person reviews’ 

The FCA will authorise an independent review, which typically looks at the specific area(s) of concern. However skilled persons reports can also be used to help the Regulator gain a clearer overall picture of the firm’s activities.  A skilled person will carry out the report itself – a member of the FCA’s Skilled Person Panel - either selected by the FCA or by the firm itself and, importantly, it is the firm who must ultimately meet the cost of this. A skilled persons report is just one of the supervisory tools the Financial Conduct Authority (FCA) has at its disposal under Section 166 (S.166) of the Financial Services and Markets Act (FSMA).  

There are 12 lots representing 12 ‘areas of expertise for skilled persons services’ identified by the FCA which could be subject to directly commissioned s166 reviews.  

‘LOT-H’ is focussed on Prudential – Adequate Financial Resources for FCA solo-regulated firms.

The remit of LOT-H is as follows:

Extracted from the Skilled Person Panel Lot Descriptions

If the FCA suspects that a regulated firm may be responsible for acts of misconduct or that it is persistently disregarding certain rules, it may issue a series of preemptive warnings that, if unheeded, can culminate in the commissioning of a skilled persons report.