Safeguarding Audit

Following their 2021, “Dear CEO” letter, on Friday 20 January 2023 the Central Bank of Ireland issued an addition “Dear CEO” letter with the purpose of reaffirming its expectations for all Payment and E-Money firms and the actions it expects the Boards and senior management of these firms to undertake to ensure the firms are in compliance with their regulatory requirements and any conditions imposed on the firms’ authorisation.

The CBI stated that institutions should start scheduling safeguarding audits with external safeguarding specialists and auditors to ensure they can submit an audit opinion and Board response to the Central Bank by 31 July 2023. 

The regulator requires, in order to become authorised as a payment or e-money institution firm, firms must have in place adequate mechanisms to protect consumer funds through ‘’safeguarding’’.

As such, applicant firms must hold funds received from consumers for payment/e-money services separately from other funds and place them in a special account held within an EEA authorised bank, or to cover the funds with an insurance or guarantee policy. 

Firms must abide by the safeguarding requirements as stipulated by the EU Second Payment Services Directives (PSD2) as well as the Electronic Money Directive, as implemented through the Central Bank (Supervision and Enforcement) Act 2013 (Section 48(1) Investment Firms Regulations 2017.

As the leading compliance firm in Ireland, you can be confident that you are receiving the correct guidance and peer-benchmarked advice.  

What is a safeguarding review? 

A safeguarding review is an independent audit of compliance with the safeguarding obligations stipulated by PSD2, Electronic Money Directive and Investment Firms Regulations.

Its objective is to demonstrate that you are adequately protecting consumer funds.

What does the safeguarding review involve?

Within the safeguarding review, we use a combination of document review, sample testing, walkthroughs and interviews with staff to understand how you have set up your arrangements and their effectiveness in practice.  

The services are delivered by our own auditors who are both expert in safeguarding and experienced in auditing. 

Why choose fscom? 

  • 10 years experience in conducting safeguarding reviews.
  • Audits are led by senior colleagues who have deep domain knowledge of safeguarding and are highly experienced in auditing.  
  • Honest and full appraisal of what your firm does well and areas requiring attention in a time efficient manner. 
  • Open and engaging communication approach with all staff based on core values of mutual respect, courtesy, patience and flexibility.

If you are looking for a thorough, independent review of your safeguarding arrangements by the leading experts in the industry, contact us today for a free initial consultation.  

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