CASS Compliance Monitoring for large UK Asset Manager

The client

Large UK Asset Manager

The work

Following regulatory interaction, our client engaged us to provide an experienced manager with extensive Client Assets Sourcebook (CASS) knowledge to design and help implement a compliance monitoring plan and to mentor and train an existing member of the Compliance Monitoring Team (CMT) to become the Subject Matter Expert (SME) on CASS.

How we helped

On commencement of the assignment, the first line team undertaking the daily oversight of the outsourced CASS arrangements had been in operation for less than 6 months, was still finding its feet, had little CASS experience and was still developing its policies and procedures. By commencing the monitoring plan with a review of CASS governance arrangements, the CMT was able to provide extensive assistance to senior management in the development of those governance arrangements and structures. Day to day oversight activities were then reviewed, including assessing the daily client money reconciliations provided to the CASS oversight team by the outsource service provider. This resulted in improving procedures, assisting in improving the first line reconciliation knowledge and understanding, and daily review oversight approach. The results of the monitoring activities were discussed with the CASS oversight team to allow them to understand the issues raised and why particular recommendations were being made prior to being issued to senior management. The CMT attended and presented its monthly compliance monitoring reports in the monthly meetings of the committee overseeing CASS, which was chaired by the CF10a. When the FCA required two CASS attestations from the CF10a, the CMT worked closely with the CASS oversight team to review documentation, system and operational developments by the outsourced service provider, in order to provide the necessary assurance to the CF10a to allow them to provide the appropriate sign off.

Value added

The assignment covered two full review cycles of the plan, which enabled the SME to develop their knowledge and expertise, to prove the tests developed were robust, and to build good relationships with the CASS oversight team and senior management. The CASS oversight team has also helped the CMT to become fully developed. The approach which was developed for CASS has now become the model utilised for the operational oversight of other outsourced arrangements in the UK.