Changes to the licence conditions and codes of practice on High Value Customers
6 - Relationship management
Licensees need to ensure HVC staff and Executives are incentivised to strike the correct balance between commercial targets and the licensing objectives. Some licensees have failed to ensure relationships between staff and HVCs remain professional and demonstrably consistent with the licensing objectives.
The draft guidance provides a non-exhaustive list of the steps licensees should consider to ensure staff are equipped and motivated to manage HVCs effectively.
- Do you agree with the proposed guidance on relationship management for HVC schemes?
- Are there additional safeguards or good practice which should be included in the guidance relating to relationship management?
Respondents largely supported the additional guidance around relationship management between staff and HVCs. Many responded positively to additional steps proposed in relation to relationship management, with one respondent noting that the proposals offer suitable and effective controls.
Whilst agreeing with the content, some respondents suggested that the draft guidance should include additional hard requirements for HVC managers.
It was suggested that requiring staff to fix spend limits based on a customer’s affordability would be a suitable requirement.
Another respondent commented that the proposed measures were critical, and that the draft guidance should go further to reflect this. One suggestion noted that the phrase licensees should consider what additional steps are required could be amended to clearly state that licensees are required to implement all measures.
The proposal to rotate colleagues who manage HVCs drew a range of responses. There was a clear split between those who favoured the proposal, and those who believed the requirement may damage staff-customer relationships. It was suggested that account managers responsible for single customers were more likely to be able to spot changes in [a customer’s] appearance, speech and behaviour in order to identify potential harms.
It was also noted that customers would be more comfortable sharing information with a familiar account manager. One respondent added that rotation could result in less equipped staff managing customer relationships. Several respondents acknowledged both sides of the discussion around staff rotation, with one noting that whilst some HVCs may benefit from working directly with one colleague, rotation should be encouraged to avoid difficulties.
As an alternative to rotating account managers, one respondent suggested that all staff in contact with HVCs should be subject to additional peer reviews, quality checks and further governance. Additionally, the respondent proposed that HVC accounts are frequently reviewed by the Head of Compliance.
The proposed guidance addresses the tension around HVC schemes between meeting commercial objectives and customer safety. Failure to document instances of customer interaction, irresponsible offering of incentives, and unprofessional relationships between staff and customers has jeopardised some licensees’ ability to safely offer incentives and, on occasion, led to exploitative behaviour.
This consultation addresses the absence of objectivity within assessments of regulatory risk during recorded customer interactions. We consider the proposed controls for staff working with HVCs will address this and provide a framework for offering incentives consistent with the licensing objectives.
We also acknowledge the calls for hard requirements for staff working with HVCs. However, we are not convinced that a highly prescriptive approach would resolve the issue of staff conducting customer interactions in a tick-box fashion, without situational objectivity. Our intention is to clearly define the required outcome and support licensees on how this may be achieved through the accompanying guidance.
We are retaining the guidance to rotate staff managing HVCs where possible. We note the concern that in some instances, customers could be more willing to share information with staff they are familiar with. However, a lack of objectivity by HVC staff managing designated customer accounts has been a recurring theme of our casework and is a risk that needs to be addressed.
The guidance makes clear our expectation that licensees must establish a more complete profile of an HVCs behaviour and spending habits and maintain a full audit trail and record of decisions – consequently, staff rotation should pose less of a concern.
HVC Response - 5 - Oversight and accountability for HVC teams Next section
HVC Response 7 - Use of incentives