Approved persons carry out certain activities on a firm's behalf and must be regulated by us. Learn about our requirements, conduct rules and 'fit and proper' test.
On this page
An 'approved person' is someone who we approve to do one or more activities for an authorised firm. We call these activities 'controlled functions'. A subset of controlled functions are 'senior management functions' (SMFs).
Whether you're the firm applying or the person or firm that's the candidate to be an approved person, you should read this page and any other relevant pages in this section about:
Requirements of approved persons
At all times, approved persons must:
- meet the requirements of our 'fit and proper' test and follow its principles
- comply with our conduct rules
- report anything that could affect their ongoing fitness and propriety, using Form D
Approved persons have a responsibility to be aware of – and comply with – our regulatory requirements and understand how they apply to carrying out each controlled function.
Our 'fit and proper' test
We use this as a benchmark to assess whether a candidate is suitable to perform a controlled function or SMF – it's not an exam they have to pass.
Before submitting your application, your firm must be confident that the candidate is fit and proper to perform the role. If we're not satisfied, we won't approve them (this applies when we're reassessing approved persons too).
We look for the candidate's:
- honesty (including being open about disclosing information)
- integrity and reputation
- competence and capability
- financial soundness
We expand on this below. There's more detail in our Handbook.
Our conduct rules
Our conduct rules apply to all employees within a firm, not just approved persons.
- set basic standards of good personal conduct, against which we can hold people to account
- help shape a firm's culture, standards and policies
- promote positive behaviours
- improve individual accountability and awareness of conduct issues
- apply to any of a firm's financial services activities, whether regulated or unregulated
There are 2 tiers of conduct rules which apply to all firms.
The first is a set of general rules that apply to most employees and directors in a firm. The second set of rules only applies to Senior Managers, and in one case also to NEDs.
If an approved person doesn't comply with our rules
We will take disciplinary action, which could include fines, suspensions of approval, imposing restrictions and issuing a public statement about the misconduct.
Examples of approved persons not complying include if they act in a way that's inconsistent with the rules for SMFs, or if they knowingly work together to breach their firm’s rules.