Project Overview
A UK IFA (Independent Financial Adviser) network with 840 advisers, £8.4B AUM (Assets Under Management), and 2...
Technology Stack
Compliance & Standards
The Challenge
A UK IFA (Independent Financial Adviser) network with 840 advisers, £8.4B AUM (Assets Under Management), and 28,000 client portfolios needed a unified portfolio analytics and client reporting platform — replacing a combination of FE Analytics subscriptions, bespoke Excel models, and paper-based suitability reviews. FCA COBS 9A (suitability reports — investment advice documentation), FCA Consumer Duty (value assessment for investment products), FCA PROD (product governance — target market assessment), MiFID II UK (retained post-Brexit — client categorisation, transaction reporting), UK GDPR, and WCAG 2.1 AA were mandatory. Budget: £160,000.
Our Approach
Portfolio analytics
- 1performance attribution (Brinson-Hood-Beebower — sector allocation vs security selection contribution to return),
- 2risk metrics (standard deviation, Sharpe ratio, Sortino ratio, maximum drawdown, beta vs MSCI World),
- 3benchmark comparison (client portfolio vs agreed benchmark — IA sector average, MSCI indices, custom benchmark),
- 4ESG scoring (MSCI ESG ratings aggregated to portfolio level),
- 5cost disclosure (MiFID II costs and charges — ongoing charges figure (OCF), transaction costs, platform fee, adviser fee — total cost of ownership).
Market data
Refinitiv (now LSEG) Data API (daily pricing, corporate actions, dividends, ESG data).
COBS 9A suitability report
written record of why an investment recommendation is suitable for the specific client.
Automated suitability report
structured data (client risk profile, capacity for loss, investment objectives, time horizon, current portfolio, recommended changes) → natural language generation (template-based — not AI hallucination risk for regulatory document).
Suitability report components
- 1client circumstances summary,
- 2investment objectives stated,
- 3recommended portfolio rationale (why this portfolio meets stated objectives),
- 4risk vs return profile,
- 5costs and charges (MiFID II COBS 2.3A),
- 6adviser confirmation. Adviser reviews and approves draft suitability report — digital signature (DocuSign) before sending to client.
MiFID II UK Transaction Reporting
MiFID II Transaction Reporting (UK retained): investment firms must report transactions in financial instruments to FCA via ARM (Approved Reporting Mechanism).
Transaction report fields
65 mandatory fields including instrument identification (ISIN, MIC), client identification (national ID or legal entity identifier — LEI), price, quantity, execution time.
ARM integration
DTCC (DTCC GTR — UK ARM).
Automated transaction reporting
trade executed → transaction report generated (65-field structured record) → DTCC ARM API submission within T+1.
LEI management
clients who are legal entities require LEI (Legal Entity Identifier — GLEIF database lookup via API).
ISIN validation
Bloomberg OpenFIGI API (ISIN → FIGI → instrument details validation).
Consumer Duty Value Assessment for IFA Products
FCA Consumer Duty (PS22/9) investment products: IFAs must assess whether the products they recommend provide fair value to clients.
Value assessment automation
- 1per-product cost comparison (total cost of ownership vs comparable products in same IA sector),
- 2performance quartile analysis (where does the product rank vs sector peers in 1, 3, 5-year performance),
- 3target market check (does client profile match product target market — PROD 3 product governance),
- 4distribution review (IFA commission vs value delivered — Consumer Duty requires no conflicts of interest in distribution).
Quarterly value assessment report
automated from analytics platform data → Board review.
The Results
FCA COBS 9A compliance confirmed.
Platform live at 24 weeks, £148,000 — under budget. 840 advisers and 28,000 portfolios migrated.
Suitability report generation time: 4.2 hours → 38 minutes.
MiFID II transaction reporting: 100% automated (0% rejection rate from DTCC — previously 4.2% manual errors).
Consumer Duty value assessment: 100% portfolios assessed quarterly (previously manual estimate: 60% coverage).
Portfolio analytics refresh: daily (previously weekly).
Adviser NPS: 82 (legacy: 28).
FCA supervisory visit: confirmed compliant.
“Suitability report from 4.2 hours to 38 minutes. MiFID II reporting 100% automated with 0% DTCC rejection — versus 4.2% manual error rate. Consumer Duty quarterly assessment 100% coverage versus 60% estimated. Adviser NPS from 28 to 82. FCA supervisory visit confirmed compliant. The portfolio analytics engine — Brinson attribution, Sharpe/Sortino, ESG scoring — is now our competitive advantage. Advisers who joined competitors because of better analytics tools are coming back." — CEO, UK IFA Network (name withheld)”
Project Details
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