When the previous employer is an authorised firm, a regulatory reference must be obtained.
Where the individual has not been working within the financial services industry during the past six years, a reference request should be issued to other relevant parties, ie benefit agencies, school/college/university/accountant or solicitor.
This is in order to establish the information supplied by the individual is accurate and assess any general issues relating to fitness and propriety and disciplinary matters.
If the candidate has been trading as a sole trader (an unincorporated firm) during the period, there is no requirement to obtain a reference, as that would be asking them to provide a reference for themselves.
Likewise, if the individual was trading as a sole director in a directly regulated firm and the firm has since closed down, there is little point obtaining a regulatory reference, however, you should establish the reasons for the firm de-authorising and closing down.
In both these instances, you should establish who their accountant and solicitor was during the period in question, and issue a reference request to them.
This differs from a normal regulatory reference and should be tailored accordingly. If you find the individual did not have an accountant or solicitor, I’d suggest you ask the individual to supply you with evidence of the business’s activities, this could be, for example, its compliance records or business bank statements.
When the individual is not a certified person or a senior manager, the regulatory reference is not a requirement, however, obtaining a reference would still be highly recommended. I’d therefore recommend adopting the same reference and time period for all advisers.
Individuals that have attended school, college or university within the past five years should be double-checked, to ensure the information supplied by the individual is correct.
I’d therefore suggest you issue a request to the appropriate educational body, asking for confirmation that the person attended there between the dates supplied on the individual’s application form.
For individuals that were unemployed and claiming benefits, you should request confirmation from the benefits agency, to ensure the information stated by the individual is accurate.
However, if the individual says they were unemployed and not claiming benefits you need to obtain further information to establish how they supported themselves during this time, ie lived off their savings or supported by their partner, and this information would also need to be noted within the individual’s application form.
Criminal records check
Where a candidate is applying to hold an SMF, the firm should obtain sight of the candidate’s criminal record certificate, to the maximum extent allowed by law, as part of their FIT assessment.
