The Banking Standards Board is consulting on draft good practice guidance on regulatory references. The guidance will be all the more important later this year when the SMCR extends the regulatory references requirements to virtually all firms.
Bearing in mind the purpose of the guidance is essentially to stop “rolling bad apples” making their way through the industry, the guidance proposes three high level principles:
- fairness to the relevant individual without compromising the integrity of the reference and the way references are used;
- proportionate – in particular taking reasonable steps to identify and verify relevant information and when considering information raised by references; and
- consistency, other with other processes and policies within a firm and, so far as possible, between firms.
The BSB seeks views on several points, and particularly focuses on how reference should deal with past, or ongoing, disciplinary issues. Consultation closes on 20 March.