Suitability reviews with AI: compliance burden to asset

What happened?

TCC and Recordsure opened their AI for compliance webinar series with a session on suitability reviews, hosted by Recordsure’s Chief Product and Commercial Officer, Garry Evans, and joined by TCC’s Technical Director, David Boyhan, and Operations Director, Neil Dethick.

A live poll asked attendees where they saw the root cause of unclear suitability ratings: 38% pointed to insufficient or contradictory fact-finding and attitude-to-risk determination, while 62% pointed to insufficient rationale for the recommendation given. Neil Dethick said this matched his team’s day-to-day experience, with files often falling short because advisers had not fully explained their reasoning, discounted alternatives or covered points such as taxation.

The panel discussed how suitability checks are often treated as an administrative, tick-box exercise, with advisers receiving unclear ratings but little constructive feedback, which can create friction between advisers and compliance colleagues.

Why does it matter?

When files are repeatedly returned as unclear without constructive guidance, advisers spend unprofitable time on rework instead of serving clients, while the underlying issue often goes unresolved and recurs in future cases.

A narrow focus on individual cases or products can also mean firms miss recurring, systemic weaknesses, and risk-based sampling that is too small or too narrow tends to produce results that offer little support for genuine root cause analysis.

Who is affected?

Compliance and quality assurance teams responsible for rating suitability files, and the advisers whose recommendations are reviewed.

Key risks

• Suitability ratings applied without detailed feedback, leaving advisers unclear why a file was marked unclear or unsuitable.
• A narrow, case-by-case review focus that misses recurring, thematic weaknesses.
• Risk-based sampling that is too small or too narrowly scoped to support meaningful root cause analysis.
• Adviser rework on remediated files, which adds unprofitable time without addressing the underlying cause.

Actions to take

1. Review whether unclear suitability ratings come with enough detail for advisers to understand and correct the issue.
2. Widen review sampling and thematic analysis to capture recurring, systemic weaknesses.
3. Use thematic analysis of review data to identify whether gaps sit mainly in fact-finding or in the rationale provided for recommendations.

Wider implications

TCC argues that combining AI-driven insights with expert oversight can turn suitability reviews from a source of friction into a source of learning, giving advisers clear, actionable feedback on what went wrong and why.

Recommendations

Firms should treat suitability review outcomes as a tool for improving adviser performance and customer outcomes, rather than only as a compliance gatekeeping exercise, and should use thematic analysis to target training and process changes at the root cause.