Staying informed and compliant with Independent Financial Adviser (IFA) compliance requirements is essential to avoid penalties and ensure that your practice is operating within official guidelines. As regulations evolve in 2026, compliance remains a challenge.
This checklist offers a clear guide to key areas of Financial Adviser compliance, helping you navigate the latest rules.
Looking for help maintaining compliance? Join ValidPath for comprehensive compliance support.
1. Authorisation and Registration
Ensure you are properly authorised by the Financial Conduct Authority (FCA) to carry out relevant regulated activities. This involves meeting fitness and propriety, threshold criteria and having appropriate systems in place to support good customer outcomes.
Staying Compliant
- Annually verify your FCA authorisation status.
- Regularly review and update your registration details and permissions.
- Align your business practices with FCA requirements.
2. Senior Managers and Certification Regime (SMCR)
The SMCR applies to Directly Authorised firms and requires that individuals in senior management roles meet specific competence and conduct standards to enhance accountability within financial services firms.
Staying Compliant
- Ensure senior management meet the FCA’s competence and conduct standards.
- Maintain detailed records of the senior managers’ roles and responsibilities.
- Provide regular training on regulatory changes.
3. Anti-Money Laundering (AML) and Counter-Terrorist Financing (CTF)
Compliance with AML and CTF regulations involves implementing systems to prevent financial crime, including thorough customer identification and transaction monitoring.
Staying Compliant
- Develop and maintain robust AML and CTF policies.
- Conduct appropriate customer due diligence and keep detailed records.
- Report suspicious activities to the relevant authorities.
4. Product Governance
IFAs must ensure that the financial products they recommend are suitable for their clients, providing clear and comprehensive information about these products.
Staying Compliant
- Implement a product governance framework to assess the suitability of financial products.
- Provide clear, concise, and relevant product information to clients.
- Regularly review and update product offerings for suitability.
5. Consumer Duty
The FCA’s Consumer Duty requires IFAs to act in the best interests of their clients and ensure that products and services meet their needs. This duty is vital for maintaining trust and delivering fair outcomes.
Staying Compliant
- Ensure client interactions and products align with the principle of acting in the clients’ best interests.
- Continuously review and adjust practices to meet Consumer Duty standards.
- Monitor and evidence good outcomes across the four Consumer Duty outcomes, including fair value assessments and communications testing.
- Identify and appropriately support vulnerable clients, ensuring communications and recommendations reflect their specific needs.
6. Record Keeping
Maintaining accurate and up-to-date records is crucial for demonstrating compliance and facilitating regulatory reviews. This includes client interactions, financial advice given, and compliance-related activities.
Staying Compliant
- Implement a comprehensive record-keeping system.
- Ensure records are accurate, complete, and easily retrievable.
- Regularly review and audit record-keeping practices.
7. Training and Development
Ongoing training and professional development are essential for keeping up with regulatory changes and maintaining compliance. A structured training and competency (T&C) approach helps ensure required learning is covered and competence is clearly evidenced.
Staying Compliant
- Put in place a structured approach to training and CPD that covers key regulatory topics.
- Keep clear records to evidence competence and ongoing development.
- Make sure training is relevant to each role and reflects current regulatory expectations.
- Use supported learning tools where appropriate to make delivery and tracking easier.
8. Suitability and Conduct of Business (COBS)
Suitability is central to Financial Adviser compliance. Firms must ensure that advice is based on a thorough understanding of the client’s circumstances, objectives and risk profile, and be able to evidence the rationale behind every recommendation.
Staying Compliant
- Conduct comprehensive fact-finds and risk assessments.
- Provide clear suitability reports explaining the basis of advice.
- Maintain records evidencing how client needs, capacity for loss and risk profile were assessed.
- Document any vulnerability factors and demonstrate how advice and service delivery were adapted accordingly.
9. Complaints Handling
Firms must have effective systems for handling complaints and ensuring fair customer outcomes.
Staying Compliant
- Maintain a documented complaints procedure.
- Respond within FCA timeframes.
- Report complaints data where required.
- Conduct root cause analysis to prevent recurrence.
10. Financial Promotions and Communications
All communications must be clear, fair and not misleading and comply with FCA financial promotion rules.
Staying Compliant
- Review all marketing materials before publication.
- Ensure risk warnings are prominent and balanced.
- Maintain approval processes for financial promotions.
- Monitor digital and social media communications.
Looking for help maintaining compliance?
We know compliance is not always easy. It is something many IFAs struggle with – that is why ValidPath members get comprehensive compliance support every step of the way, so they can stay on top of compliance demands with ease and focus on their business.
Join ValidPath for comprehensive compliance support.
