It is a fact that in the majority of situations where a broker is accused of doing something wrong, that the circumstances and issues are complicated. However, when a broker is actually found to have done something wrong, hindsight shows that the error or omission actually related to something blindingly simple. See how you get on with this case study.This week the MOT is specifically designed for individual or discussion group CPD. If you are going to create a small discussion group, there is a little preparation needed for this to qualify as structured CPD.
Identify those to attend. Ask them to consider the case study before you get together. Set aside at least half an hour. Take notes of the various points of view that will inevitably be voiced. Seek to establish a group response, taking account of everybody's views.Wilf Arkwright is a senior account handler of a small broker near Cheltenham. As befits his status as a long-standing member of staff, he has taken a day off to visit the races. Having just won £200 on a rank outsider in the 2.30, he is feeling relaxed and rather pleased when he bumps into a longstanding client, Pat Fitzgerald. After the usual greetings, Pat tells him that he has just been banned from driving for a month and, as a result, has decided to sell his Jaguar. He has decided to 'downgrade' to an elderly Land Rover, because he thinks that he is less likely to get stopped in it in the future. The good news is that he got the full asking price of £15,000 for the Jaguar; the bad news is that he has it in a briefcase case with him at the racecourse and he is in a hurry to catch a train to Bristol, where he is due to get on a plane bound for Morocco - not a holiday, but business. He is in a bit of a rush because he has only just returned from another business trip in Holland.He asks Wilf if he could see his way to taking the briefcase and putting it into the broker's safe until he returns in three days' time. Wilf, always ready to please (especially good customers) agrees in principle, but tells Pat that he just needs to telephone his boss to make sure that this will be OK. He calls to check with the senior partner, Brian Goodenough . Brian, who does a lot of business with Pat, says that he will be happy to keep the money, so long as there is an agreement that the firm does not accept any responsibility for it while it is on the premises. Pat agrees and Wilf takes the case.On the way out of the racecourse, Wilf notices that there is an unusually large police presence, with cars being stopped and people questioned. However, he doesn't get stopped and, although he is held up for a while, he eventually gets back to the office where he stows the briefcase away in the safe. On his way home that evening, he picks up the local newspaper, where he reads a report about the police checking the racecourse because of reports that it may have been used as a money laundering facility. This was described as taking money from crime, betting the money on a race and, hopefully, receiving winnings which became 'clean' money. Wilf is horrified as he thinks about all that cash in the office safe, and Pat Fitzgerald flitting between 'business deals' in Holland and Morocco.After a sleepless night, Wilf expresses his concern to Brian at the office the following day . They have a conversation about client confidentiality, but Brian feels that if they tell Pat about their suspicions, this could be seen as 'tipping off', which in itself could carry a jail sentence. They decide that under the Prevention of Crime Act they have a responsibility to advise the proper authorities, which they do.Pat Fitzgerald is arrested on his return from Morocco and questioned. About 48 hours later, Brian is informed that there is nothing untoward about the cash and the money has been returned to Pat.Brian and Wilf are rather glum because they handle all Pat's insurances, business and personal and they feel sure that they will lose a substantial account for their troubles and honesty. Gladly, half way through the afternoon, their fears are dispelled when a case of champagne and a note arrives, from Pat. Despite the inconvenience, he is hugely impressed at the level of professional integrity within the firm.He recounts the story of how, earlier in his business life, he could have avoided being swindled out of a large sum of money if previous professional advisers had been so conscientious.Brian calls for two glasses, smiles and pops a bottle of champagne open."Are you going to tell Pat's insurers what has happened?" he asks Wilf.You are Wilf. What is your response to Brian?a) No, Give your reasons whyb) Yes. What are you going to tell them?The facts of this case study are real, but the names and location have been changed. We are grateful to the expert team at brokerASSESS for allowing us to use their copyright material.There are nearly 60 case studies available to brokerASSESS subscribers and this is just an extract from one of them. If you would like further details on brokerASSESS, contact Kirsty Gordon at Biba on 0207 623 9043.
Waltham Pitglow is a consultant specialising in compliance with RW Associates This page is edited by RW Associates, specialists in training, compliance and competence. Email: ruy.lopez@brokercompliance.co.uk 
