Brokers should not find the FSA requirements too onerous and many should have them in place, as they are simply disciplines a normal business should undertake.

The requirements include a business plan, clearly defined working procedures, training plans, proper employment strategy, a clearly defined complaints procedure, an audit trail on all files, clearly presented information to the client, a business continuity programme (disaster recovery plan) and strict control of client's money to name a few.

There is probably nothing in this list that would cause an average business much concern.

No one can argue that the industry does not need some form of regulation, but the regulator must be effective. Apart from the FSA there is an army of lawyers who are waiting to point the finger at brokers who are negligent.

This is becoming a serious threat to the broker as it is estimated that something like 80% of businesses suffering a major disaster are either under-insured, have deficiencies on their insurance programmes or they have not had their policies explained by brokers. In some cases this can result in a major professional indemnity claim.

Many brokers have failed to invest in new technology and are therefore finding it quite time-consuming to meet the compliance requirements. Under-investment could prove to be a false saving as equipment for information technology is not expensive and an electronic filing system can save time and money, as this relieves the continuous searching for files or documents.

In conclusion I would say that it is all about service to the client and the FSA could open up many opportunities for the professional broker that should not be costly or time-consuming. If they don't see this as an opportunity then are they in the wrong business?

Roy Walton
Bromwall Ltd