[Note: Article 3(1), fourth paragraph, of the IMD]
Typically an insurance intermediary will appoint a person performing a governing function (other than the non-executive director function) to direct its insurance mediation activity. Where this responsibility is allocated to a person performing another function, the person performing the apportionment and oversight function with responsibility for the apportionment of responsibilities must ensure that the firm'sinsurance mediation activity is appropriately allocated.
The descriptions of significant influence functions, other than the required functions, do not extend to activities carried on by an insurance intermediary with permission only to carry on insurance mediation activity and whose principal purpose is to carry on activities other than regulated activities (see SUP 10.1.21 R). In this case, the firm may allocate the responsibility for the firm'sinsurance mediation activity to one or more of the persons performing the apportionment and oversight function who will be required to be an approved person.
- (3) 2
The FSA will specify in the FSA Register the name of the persons to whom the responsibility for the firm'sinsurance mediation activity has been allocated. by inserting after the relevant controlled function the words "(insurance mediation)". In the case of a sole trader, the FSA will specify in the FSA Register the name of the sole trader as the 'contact person' in the firm.
An insurance intermediary must establish on reasonable grounds that:
demonstrate the knowledge and ability necessary for the performance of their duties; and
[Note: Article 4(1) and (2) of the IMD]
has not been convicted of any serious criminal offences linked to crimes against property or other crimes related to financial activities (other than spent convictions under the Rehabilitation of Offenders Act 1974 or any other national equivalent); and
has not been adjudged bankrupt (unless the bankruptcy has been discharged);
[Note: Article 4(2) of the IMD]
Firms are reminded that Principle 3 requires firms to take reasonable care to organise and control their affairs responsibly and effectively. Principle 3 is amplified by the rule which requires firms to take reasonable care to establish and maintain such systems and controls as are appropriate to its business (SYSC 3.1.1 R). A firm's systems and controls should enable it to satisfy itself of the suitability of anyone who acts for it (SYSC 3.2.13 G). This includes the assessment of an individual's honesty and competence. In addition, the Training and Competence sourcebook lists some general, high level commitments to training and competence which every firm should make and fulfil.