The Professional Financial Claims Association has engaged the services of Rockstead to carry out ‘Assurance Audits’ in respect of its members’ compliance with the published Code of Practice.
Key points of our Compliance & Auditing
The Professional Financial Claims Association (PFCA) operates a Code of Practice covering member’s conduct of business and their relationships with consumers and third parties. The Code of Practice covers the business aspects of a Financial Claims Management Company including, business acquisition, marketing and advertising, charges, business processes and financial claims investigation, staff training and monitoring, customer contracts, data protection and complaints. The PFCA operates a Compliance Monitoring Committee, this has an independent Chairman which maintains close links with regulators, consumer groups and the media, supported by quarterly meetings of its Independent Consultation Council. Links with these bodies play a vital role in helping develop its Code of Practice.
Our Code Monitoring and Enforcement Activity
Membership Application, Review and Audit
All firms applying to join the PFCA are required to take part in a membership application review and audit. The independent chairman of the PFCA will select two other directors (ensuring no conflict of interest) to assist with the review [“the selection panel”]. As part of the review, those selected to undertake the review may consider the applicant firm’s business model, documentation, marketing material and internal systems. Discussions with management, visiting offices and call centres to check sales processes and procedures may be undertaken.
Post Review & Audit
Once the review has been completed to the satisfaction of the selection panel, the applicant firm’s compliance with the Code of Practice will be audited by the PFCA Code of Practice auditors (the cost of which is borne by the applicant firm). When the selection panel has received the independent Code of Practice compliance audit, the selection panel will make a recommendation for membership at the next full Board meeting. No firms are allowed to become PFCA members unless the PFCA Board are satisfied that they are able to comply with the Code of Practice fully from the start of their membership.
Thematic Reviews, Mystery Shopping and Investigations
The PFCA Board will, from time to time, undertake thematic reviews, mystery shopping exercises and investigations. These involve the examination of a particular aspect of the Code of Practice across a selection of member firms. The PFCA maintains close links with regulators, consumer groups (including our Independent Consultation Group) and the media. The feedback received from these groups plays an import part in our Code of Practice monitoring process and helps us continually improve our Code of Practice and our member’s compliance with it.
Annual Audit of Code Compliance
Member firms agree to submit themselves to an annual code compliance audit by the PFCA Code of Practice auditors. Where shortcomings are identified as a result of our thematic review, mystery shopping, investigations or the annual Code compliance audit, a remedial action plan is agreed with the firm. This action plan will be monitored by our independent chairman to ensure that it is successfully implemented. The full PFCA board always receives reports on these matters and any serious breaches that are identified are considered for possible enforcement action.
The principle aim of the PFCA is to improve standards across the financial claims industry and, therefore, we work with member firms to enable them to comply with our Code of Practice. Enforcement will generally, therefore, be as an exception. However, where enforcement action is considered necessary the case will be considered by the PFCA Compliance Monitoring Committee, which will be formed and chaired by our independent chairman with the assistance of two directors selected by the independent chairman, to ensure no conflict of interest.
Code of Practice Breach
The Compliance Monitoring Committee will recommend a penalty to the full PFCA board, in all cases of a Code of Practice breach and we will expect firms to take immediate remedial action once a breach has been identified. Penalties available to us for material breaches include:
- The issue of directions as to future conduct.
- The issue of a warning or reprimand.
- Cancellation or suspension of a firm’s membership.
Cancellation or Suspension of Membership
Where the Compliance Monitoring Committee deem it relevant they may, with the agreement of the full PFCA board, inform the Claims Management Regulator, or any other regulator it deems appropriate, of the cancellation or suspension of a member. The member’s record will be removed from the PFCA website immediately. All rights granted to for the use the PFCA logo will be withdrawn.