What Is SMCR Screening? FCA Vetting and Fit & Proper Checks Explained
SMCR screening is the background verification used by regulated financial-services firms to support their responsibilities under the Senior Managers and Certification Regime, commonly known as the SM&CR.
It can help a firm verify information about candidates and existing personnel when assessing whether somebody is fit and proper for a relevant role.
However, screening does not itself determine fitness and propriety.
That decision remains with the regulated firm and, for Senior Management Functions requiring regulatory approval, forms part of the firm's application and the regulator's approval process. Certification staff, by contrast, are assessed and certified by their employer rather than individually approved by the FCA.
What Does SMCR Mean?
SM&CR stands for Senior Managers and Certification Regime.
The regime is intended to strengthen individual accountability and standards of conduct within UK financial services. It consists broadly of three elements:
- The Senior Managers Regime
- The Certification Regime
- The Conduct Rules
Senior Managers perform specified Senior Management Functions and generally require regulatory approval before performing those functions.
Certification staff perform functions capable of having a significant impact on customers, the firm or market integrity. They are not individually approved by the FCA. Instead, their firm must assess whether they are fit and proper and issue the appropriate certificate.
What Is a Fit and Proper Assessment?
The FCA identifies three principal areas when firms assess fitness and propriety:
- Honesty, integrity and reputation
- Competence and capability
- Financial soundness
These are broader regulatory assessments, not individual background checks.
For example, a credit search might provide information relevant to financial soundness, while employment and qualification verification may contribute evidence relating to competence and capability.
No individual screening result should automatically be treated as proving or disproving fitness and propriety.
The regulated firm must consider the relevant evidence in context and reach its own assessment.
Who Needs SMCR Screening?
Screening requirements depend on the individual's function, the type of firm and the regulatory obligations that apply.
Particular attention is generally required for:
Senior Managers
Senior Managers perform designated Senior Management Functions.
Firms must satisfy themselves that a proposed Senior Manager is fit and proper before applying for regulatory approval and must continue assessing relevant Senior Managers on an ongoing basis.
Certification Staff
Certification staff perform specified functions that may have a significant impact on customers, the firm or market integrity.
The FCA does not individually approve these employees.
Their employer is responsible for assessing whether they are fit and proper when appointing them and on an ongoing basis, including an assessment at least annually.
What Checks Can SMCR Screening Include?
There is no single universal package called an “SMCR background check”.
The appropriate verification depends on the role, the firm's policies, the regulatory requirements and the information required for its fitness and propriety assessment.
Screening may include:
- Identity verification
- Employment-history verification
- Regulatory references
- Qualification and professional-membership checks
- Appropriate criminal-record checks
- Relevant financial screening
- Directorship and corporate-interest searches
- Sanctions and regulatory searches
- Appropriate adverse-media research
- Social media screening where justified
- International background verification where relevant
These checks provide information to the regulated firm.
They do not transfer responsibility for the firm's regulatory assessment to the screening provider.
What Are SMCR Regulatory References?
Regulatory references are particularly important under the SM&CR.
For relevant appointments, firms may need to obtain prescribed information from current and previous employers so that past conduct, disciplinary findings or fitness and propriety concerns can be considered.
For Senior Manager applicants, FCA guidance requires appropriate referencing covering the previous six years.
This does not mean every element of an SMCR screening programme is automatically required to cover six years.
The six-year requirement is principally associated with the regulatory-reference framework. Other employment or background verification should be scoped according to the applicable obligation and the firm's requirements.
The FCA also updated parts of the regulatory-reference framework during its 2026 reforms. Firms should therefore work from the current FCA Handbook rather than relying on older SM&CR checklists.
Do SMCR Roles Require Criminal Record Checks?
Criminal-record requirements depend on the position.
For an individual applying to perform an FCA-designated Senior Management Function, the firm must obtain the fullest criminal-record information it can lawfully obtain as part of its assessment before submitting the application.
This should not be interpreted as meaning that every employee subject to the SM&CR automatically requires the same level of DBS check.
DBS eligibility remains dependent on the role and relevant legislation.
The FCA's 2026 reforms also changed parts of the criminal-record-check framework, making it particularly important that firms apply the current rules to the specific appointment.
What Does Financial Soundness Mean?
Financial soundness is one of the FCA's three principal fitness and propriety considerations.
However, it should not be reduced to a simple credit score.
Information such as bankruptcy, insolvency, significant judgments or other relevant financial circumstances may sometimes form part of a role-appropriate assessment.
Financial difficulty does not automatically establish dishonesty, poor integrity or an inability to perform a regulated role.
Any information identified should be assessed in context by the regulated firm against the actual FCA fitness and propriety requirements.
Are Qualifications and Employment History Checked?
For some regulated roles, qualifications, experience and professional competence are particularly important.
Screening may therefore verify:
- Employers and employment dates
- Positions held
- Relevant professional qualifications
- Academic credentials
- Professional memberships
- Regulatory status
- Material discrepancies requiring clarification
Verification can establish whether claims made by a candidate are supported by available evidence.
It does not replace the firm's own assessment of whether the candidate has the competence and capability required for the particular role.
Is SMCR Screening a One-Off Process?
No.
The SM&CR includes ongoing responsibilities.
Certification staff must be assessed as fit and proper when appropriate and at least annually while they continue to perform a Certification Function. Senior Managers are also subject to ongoing fitness and propriety requirements.
That does not mean every background check must automatically be repeated every year.
A firm's annual assessment should determine what current evidence it needs.
Some information may need refreshing, while other previously verified information may remain sufficient unless circumstances have changed.
What Changed Under the 2026 SMCR Reforms?
The FCA introduced the first phase of reforms to the Senior Managers and Certification Regime during 2026.
The changes were intended to make the regime more efficient and proportionate while retaining individual accountability.
They covered areas including:
- Certification requirements
- Regulatory references
- Criminal-record checks
- Conduct Rules
- Senior Manager administration
- Statements of Responsibilities
- Enhanced-firm thresholds
- Regulatory reporting and the Directory
Most first-phase changes took effect on 24 April 2026, with further process changes taking effect in July 2026. Additional changes relating to non-financial misconduct are scheduled for 1 September 2026, and a second phase of reform may follow.
For that reason, employers should use current FCA and PRA requirements rather than relying on historic SM&CR screening templates.
What Happens If Screening Finds an Issue?
An adverse result should not automatically determine the outcome.
Where screening identifies something potentially material, the firm should consider questions such as:
- Is the information accurate?
- Does it relate to the correct individual?
- Is it relevant to the regulated function?
- Has the candidate had an appropriate opportunity to explain it?
- Does further evidence resolve the issue?
- How does it affect the firm's fitness and propriety assessment?
The purpose of screening is to provide reliable information for assessment rather than automatically label an individual as fit or unfit.
SMCR Screening and FCA Vetting Services
Conflict International provides specialist SMCR Screening & FCA Vetting Services for regulated financial-services firms.
Depending on the role and agreed scope, screening can include identity, employment, qualifications, regulatory references, appropriate financial information, criminal-record checks and other relevant verification.
International checks can also be coordinated where candidates have lived, worked or held regulated positions overseas.
Where broader employee verification is required outside the SM&CR population, screening can form part of a wider Pre-Employment Screening programme.
Conflict International provides factual screening and verification information. The regulated firm remains responsible for determining fitness and propriety and meeting its FCA or PRA obligations.
Need SMCR Screening Support?
If your firm is appointing Senior Managers, Certification staff or other personnel requiring specialist financial-services screening, Conflict International can help structure and manage the appropriate verification programme.
Complete the enquiry form below to discuss your SMCR Screening and FCA Vetting requirements.