Case Studies – Broad Reach Partnership Ltd

Documentation and Training - Medium Sized London Broker

The client required its policies, procedures and controls in relation to the protection of Client Money and CASS compliance to be reviewed and documented. A comprehensive collection of practical Client Money documentation was produced that fitted the client’s business model. These included a number of policy documents, procedure manuals, cash flow mappings, numerous operational checklists, revisions to job role descriptions and a comprehensive Client Money business recovery plan. The project included the designed and delivery of bespoke CASS training to staff across the whole business.

Insurer TOBA Project - Medium Sized Lloyd’s Broker

Having identified problems with its insurer TOBA’s, BRP was engaged to establish the extent of the gaps in the client’s insurer TOBA documentation. The review covered insurer TOBAs and Binder wordings and a full report of recommendations actions was produced. New processes for the on boarding and management of insurers were devised and implemented. Detailed CASS checklists and an Insurer TOBA register were designed and staff were trained on the requirements. A reconciliations control between IBA systems and the new Insurance TOBA register was established to identify documentation gaps. Oversight of client staff was provided to ensure efficient conclusion of CASS compliant insurer TOBA agreements.

Documentary advice – Insurer Trust - Large Lloyd’s International Broker

The client’s legal department requested CASS compliance advice on the wording of certain Insurer Trust agreements, bank trust acknowledgement letters, insurer TOBA and Binder wordings relating to operation of a specific insurer only trust bank account. Existing documentation was reviewed, CASS compliance issues identified and alternative wordings drafted for the client’s approval.

Recruitment and training of Client Money Manager - Large Lloyd’s broker

The CFO was assisted in recruiting a Client Money Manager, who was then provided CASS SME support and training over a period of 6 months to assist their settlement into the role.

CASS Breaches - Large Lloyd’s Broker

The client’s system for handling its CASS breaches was identified as inadequate. The system was redesigned to establish a comprehensive three stage process to Record, Assess & Remediate. This was centred around a new structured breach checklist and integrated breach register for monitoring and reporting. This resulted in the firm’s CASS breaches being more effectively and efficiently recorded, analysed and resolved.

Preparation for CASS 5A - Large Lloyd’s International Broker

BRP were employed as consultants to review all the CASS rule changes proposed in CP12-20 (CASS 5A). Broad Reach produced a matrix of the CASS 5 and CASS 5A rules highlighting the changes and the implications for the client’s processes and controls and systems. Solutions were designed and specifications for IBA systems enhancements created to make it possible to automate the production of Client Money calculations. Despite FCA abandoning CASS 5A, the client has now implemented the automated Client Money calculations. The matrix was developed into a comprehensive CASS Rules, Risks & Controls mapping long before it became an FRC Standard requirement.

CASS Process and Controls Review -Large UK Retail Broker and Network -

A number of significant issues within the broker’s Client Money processes and controls that had not previously been identified by their external auditors. Following its own identification of the problems this led to an adverse CASS report. BRP was engaged as consultants to help remediate the issues. The broker’s CFO was supported in prioritising the issues and conducted the firm’s first complete detailed review of all Client Money calculations over a large number of separate Client Money bank accounts and on multiple systems. A significant number of new errors were identified and a report of recommended solutions was provided to senior management for implementation.

Insurer TOBA Project -Large Lloyd’s Broker

Our client had been unable to evidence a significant number of Insurer TOBAs across its large business portfolio. The client had tried unsuccessfully to quantify the extent to which insurer TOBAs were missing or the extent to which this represented a breach of CASS 5. Broad Reach implemented the firm’s first full reconciliation between its numerous systems and its TOBA register and established detailed KPI reporting to monitor progress. The firms insurer accounts were rationalised and prioritised. The firm’s standard TOBAs and Binder wordings were reviewed and changes recommended including the creation of short form Insurer TOBA letters. An Insurer TOBA checklist was created together with training and a set of practical procedures. Broad Reach provided CASS oversight and CASS SME support to the client’s on boarding and legal teams over a period of 9 months. The final result was that the firm achieved virtually 100% Insurer TOBA coverage within 12 months.

CASS Rule, Risk & Controls Mapping

A broking group comprising a number of firms required the production of CASS rules mappings for each firm to meet the requirements of their auditors conducting CASS Assurance reports under the latest FRC standard. As part of the project Broad Reach produced a separate report of recommended actions and assisted in delivering many of the solutions to gaps in controls. The comprehensive mappings were produced to tight timescales and were well received by the group, the various firms and their auditors.

Client Money Calculation - enhancement project - large complex international broker -

The broker was regularly experiencing significant numbers of errors in its Client Money calculations across a number of complex systems involving many people and complex models. Broad Reach oversaw a review of processes and systems and a root cause analysis was conducted. Systems were simplified, processes automated to reduce risks and new review controls introduced. This resulted in a significant cut in error rates to virtually a nil level and well within the firm’s accepted risk appetite.

Insurer TOBA project - Medium Sized Lloyd’s Broker

The firm had received an ‘except for’ opinion on a number of issues within its latest independent Client Money audit. They had also been requested to address certain Client Money issues following an earlier Client Money visit by the FCA. BRP was engaged to support the firm in remediation of the issues raised. The work included a reconciliation of systems to Insurer TOBA records and the enhancement of the processes and controls for the on-boarding of insurers and review clauses relevant to Client Money/CASS within the firm’s binder wordings and insurer TOBAs. The project provided the client with a full written report, including an audit trail of all work performed, substantially improved TOBA records, enhanced control recommendations and the delivery of practical checklist controls for on-going use by the client.

Key support during S166 skilled person CASS report - Medium Sized London Broker

The client identified significant shortcomings on its CASS processes that had not previously been identified by the firm’s auditors. This resulted in the Regulator requiring a S166 Skilled Persons Report on Client Money. BRP were employed as consultants by the client to support them in responding to the Skilled Persons’ enquiries. Broad Reach conducted a separate quick and detailed review to identify weaknesses in the CASS procedures and controls; designed remediation solutions for client’s approval; and then helped the client to implement those solutions. As a result, the majority of the major issues raised in the eventual S166 report were resolved by the time the final S166 report was published and all remaining matters were resolved within a few months. Broad Reach was also able to successfully challenge and rebut certain CASS interpretations and conclusions made by the Skilled Person’s during the S166. Ultimately the delivery of an effective quick remediation helped the client to avoid a fine.