Outsourcing Compliance With The FSA’s CASS Rules

"Outsource - arrange for work to be done outside one's own company" - Compact Oxford English Dictionary

At first sight, why should outsourcing the work involved in meeting the FSA's Client Assets (CASS) rules be any different to any other outsourcing arrangement? For many firms that hold client money and/or custody assets, compliance with the CASS rules is a major consumer of resources and getting a third party to carry out the CASS administration might be considered by management as a very sensible thing to do. Unfortunately care is needed as some of the normally perceived benefits of outsourcing, such as greater flexibility, reduced need for specialists and reduced operating expenses, may not exist in in quite the same way in a CASS regulated environment.