Turning no change reviews into insightful compliance opportunities

What happened?

In a recent webinar, TCC polled attendees on how often they formally assess suitability at a client’s annual review, even when the outcome is no change.

Just 20% of firms said more than 10% of their annual reviews are subject to a suitability check, while 80% said only 0 to 10% are checked.

Why does it matter?

David Boyhan, TCC’s Technical Director, says no change reviews should never be ignored: these files can be high risk, particularly when a client’s circumstances haven’t changed for several years.

The absence of a new product recommendation is often why they get overlooked, yet ongoing suitability still needs to be verified, and the FCA’s ‘show me, don’t tell me’ approach means firms must evidence good outcomes rather than assume them.

Who is affected?

Wealth management firms where no-change review clients often represent a larger share of the client bank than new business clients, and the compliance teams responsible for sampling and evidencing their reviews.

Key risks

• No change reviews being treated as low priority because there is no new product recommendation to check.
• Higher-risk products such as drawdown accounts not receiving more frequent scrutiny than lower-risk holdings like ISAs.
• Clients who haven’t engaged for over 12 months continuing to pay fees without evidence they are still benefiting.
• Inability to evidence a reasonable sampling process, increasing the risk of FCA censure.

Actions to take

1. Confirm that a meaningful annual review has taken place for every client, including no-change cases.
2. Check that client objectives, needs, attitude to risk and capacity for loss remain aligned with the advice given.
3. Vary review frequency by product risk, giving closer scrutiny to higher-risk holdings such as drawdown.
4. Use AI to flag cases needing attention and RAG-rate files on timeliness, documentation and outcomes, while keeping human judgement for the final decision.

Wider implications

Treating no-change reviews as a genuine compliance checkpoint, rather than paperwork, helps firms build a defensible evidence base under the Consumer Duty’s ‘show me, don’t tell me’ expectations.

Recommendations

TCC is offering a free consultancy review for ongoing services cases, with the first five firms to respond receiving a sample assessment of 100 client files to benchmark current standards.