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MIGI 5.2 Statutory status disclosure

MIGI 5.2.1G

Our rules require firms to provide appropriate and adequate information about the identity of the firm's regulator, i.e. the FSA. The requirements regarding statutory status are in GEN 4.3 and GEN 4 Annex 1. These can be summarised as follows:

  1. (1)

    Authorised firms must take reasonable care to ensure that every letter (or electronic equivalent) which it or its employees send to a private customer, with a view to or in connection with the firm carrying on a regulated activity, discloses that the firm is "Authorised and regulated by the Financial Services Authority".

  2. (2)

    Appointed representatives are required to disclose that "[name of Appointed Representative] is an appointed representative of [Firm] which is authorised and regulated by the Financial Services Authority".

  3. (3)

    You should not abbreviate the Financial Services Authority to FSA in this context.

  4. (4)

    You are likely to find it convenient to include the required disclosure on your firm's letterhead.

MIGI 5.2.2G

To allow mortgage and insurance intermediaries who are not currently authorised time to make the necessary changes to their stationery, we have introduced a transitional provision which means that firms do not have to amend their stationery to include disclosure of their statutory status until 15 July 2005.

Changes to disclosure requirements when your firm carries on insurance mediation activities or regulated mortgage activities for another authorised firm or an AR

MIGI 5.2.3G

A waiver and modification by consent has been in force for firms (third party processors) who undertake regulated activities on behalf of another authorised firm. This waiver and modification affected MCOB 1.2.1 R, ICOB 1.2.1 R and GEN 4.3.1 R. This has now been replaced by permanent rule amendments, which came into force on 1 June 2005. See the Third Party Processors Instrument 2005 - 2005/25

MIGI 5.2.4G

The rule amendments allow a third party processor (Firm A) undertaking regulated mortgage activities or insurance mediation activities (in relation to non-investment insurance contracts) on behalf of another authorised firm (Firm B) under an outsourcing contract to disclose to customers that it is B where our rules would otherwise require A to disclose its real identity. The outsourcing agreement between the two firms must acknowledge that the firm outsourcing the activities (Firm B) accepts responsibility for the activities carried on by the other firm (Firm A) on its behalf.

MIGI 5.2.5G

The rules also cater for cases where an AR acts as third party processor for its principal, or where an authorised firm acts as third party processor for an AR.

MIGI 5.2.6G

The following chapters of this Guide are also relevant:

Advising and selling standards (MCOB 4) - Part II, Chapter 2.2

Advising and selling standards (ICOB 4) - Part III, Chapter 3.3