The lack of fund management transparency and how Digiterre can help - Rob Swan
As the financial news continues to be dominated by the fallout from the Neil Woodford scandal, which is now dragging the UK regulator, the FCA, into the mix. It is times like these that I look at the investment funds industry for the next big advantage and how we can make the most out of probably the UK’s best known ‘Star’ fund manager’s fall from grace.
The industry does share one common view Neil Woodford is a spent force. Irrespective of how long it takes him to re-open his funds, once he does, the redemptions piling up will mean that he is very unlikely to have a business at the end of it.
The FCA are also now facing questions, and quite rightly to. They claim that they ‘missed clear warning signs’ as regulator to the industry that argument will not give an already beleaguered industry much confidence. However, there is an existing piece of regulation that the FCA have stood back from since introduction and one that could save their reputation.
The two pillars upon which MIFID 2 was built; client protection and transparency are exactly those that Woodford did not follow and the same pillars that the FCA can now use to prove to the industry it is doing its job.
How does this help Digiterre?
Simply, the FCA will now be under severe pressure to prove their worth. MIFID 2 already exists. I suspect therefore that they will begin to take this far more seriously and begin to pressure investment firms to begin having far more transparency and client protection.
Digiterre excels in the area of risk, compliance and distribution data and tackling the big industry data problems. With the FCA, forcing MIFID 2 upon an industry harder than ever before will inevitably lead worried investment firms looking for urgent data solutions to prove back to the FCA that they are fully compliant.
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