Client / Investor Categorisation: Review and Remediation Solutions
By: Judd Advisory, Judd Advisory
Published: 2026-07-10 · Read time: 3 min · Category: Regulatory
The FCA's new Client Categorisation and Certified Investor return has drawn attention to firms' categorisation and record-keeping processes. Is your firm's evidence audit-ready?
Many FCA regulated firms have recently had to complete a new FCA RegData item, namely the 'Client Categorisation and Certified Investor return', which has drawn much attention towards categorisation and record keeping processes. The return itself seemed innocuous enough at first but a closer examination illustrated how inadequate records make it impossible to demonstrate compliance with the rules, or to put it another way, if it isn't written down then it is not happening.
Why does it matter?
Categorisation determines the level of regulatory protection received and shapes what firms must do, starting with initial assessments of eligibility, for financial promotions to be communicated.
Consumer protection is central to the FCA's objectives and so misclassification or inability to justify the classification applied carries real regulatory risk, particularly when opting up what would otherwise be retail clients.
What did we learn?
Maintaining an organised system of recording categorisation within your CRM is the focal point to comply with the rules. Those firms communicating financial promotions to prospects should recognise this regime could apply from the very first touch point.
But, and this is the important bit, those records should go beyond a simple classification note such as "per-se professional" client. The records need to be able to demonstrate appropriateness of that classification with clear, objective evidence that is auditable. "He's my friend from previous employment and is mega wealthy" or "She's a CIO at another fund" may well be true but such statements don't justify a classification or stand up to regulatory scrutiny.
How can Judd help?
The FCA will undertake follow-up work which will involve a detailed review of certain firm's processes and records prior to publishing a good and bad practice guide. So now is a good moment to make sure your firm is part of the good practice.
Judd's Client / Investor Categorisation review is an independent and objective review that assesses the firm's categorisations and supporting evidence. We will provide a list of our findings, identified gaps and the required enhancements. Judd will also assist or manage any necessary remediation.
Please contact us at adam.palmer@juddadvisory.com to find out more.
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