LBMA Compliance Officer, Graham Jelf, interviews Tobias Wilson, Chair of LBMA’s Regulatory Affairs Committee (RAC).
I joined LBMA’s Compliance team in November 2021, following some 35 years working in the commodities field. My current objective is to provide support to the LBMA Executive and be a sounding board for our Members, Refiners and Affiliates on regulatory matters as they arise.
My first high-profile, and demanding, piece of work has been to facilitate the review, and where necessary, refresh, of the Global Precious Metals Code, first launched in 2018. The first public consultation on the Code review was launched in July 2022.
Tobias Wilson (Senior Manager, Markets & Securities Services Compliance at HSBC) is Chair of the Regulatory Affairs Committee (RAC) and I work closely with him on that committee and on the Global Precious Metals Code Working Group, which is a subgroup of the RAC.
Graham Jelf, LBMA Compliance Officer
Graham Jelf: Hi Tobias, thanks for agreeing to be interviewed for the Alchemist. So how long have you been in the precious metals business?
Tobias Wilson: My pleasure Graham. From the start of my career in banking, I have always been involved in the commodity business. All of the firms I have worked for have had very strong precious metals franchises. I started in the industry back in 2005 at Morgan Stanley in its Fixed Income and Derivatives team and quickly gravitated to the Commodities Compliance team, who were experts in their field and great mentors. I found the sheer diversity of products fascinating, and I’ve always been attracted to the tangibility of commodities. After four very good years, I had the opportunity to move to Singapore with UBS and experience all that Asia had to offer, which was something that I look back on with fond memories. And then I came back to the UK, joining Barclays Capital and then on to my current role as a senior compliance officer covering the FX and commodities business at HSBC. So around 17 years.
The diversity of issues on which a compliance officer is asked to opine is one of its great attractions.
What was one of your first memories related to the precious metals business?
Well, one immediately springs to mind – the first time I saw and handled a four 9 bar!
Can you describe your day job with HSBC?
It’s true that no day is the same. There is much more structure in the role than perhaps there has been historically. I still provide advice on transactions — which used to be a core part of the day — but there are many more elements to the role now which require management and oversight: from reporting to escalation to delivery of key training. The diversity of issues on which a compliance officer is asked to opine is one of its great attractions and typically involves engagement with many different stakeholders, primarily the front office. The other key elements of my role involve new initiatives or product reviews, risk assessment and generally acting as a risk steward to support the business and other functions.
Tobias Wilson, Chair of LBMA's Regulatory Affairs Committee (RAC)
Given the variety of your role at HSBC, which elements present the biggest challenge and which the greatest satisfaction?
The two tend to be inextricably linked. Over the years, the front office has had to become well versed in the various rules, regulations, principles and codes that govern the precious metals industry. The key questions that tend to invoke the biggest challenges relate to those areas where further clarity on the rules is sought, and as a compliance officer, one needs to assess a number of different factors when providing a view. That successful outcome in terms of navigating those types of issues gives me the greatest satisfaction.
Would you recommend working in Compliance Advisory to someone new to the financial world and, if so, why?
Without hesitation! Compliance really is at the forefront of many key decisions impacting the business, and it tends to be a function that is engaged on most, if not all, key issues. Being based on the trading floor when the market is active or a market event is unfolding is still a very exciting place to be.
Compliance really is at the forefront of many key decisions impacting the business
What do you see as the biggest challenges for the precious metals market?
We have seen a significant and fast-paced evolution of both the precious metals market and the associated regulatory framework. LBMA has been that intrinsic link between the market and regulators, advancing market standards and developing market solutions.
Some of that evolution has been forced by regulatory and conduct factors, others have been technological enhancements and some have simply been driven by market dynamics. We can look back to some examples such as the precious metals benchmark work, Brexit, the advancement of precious metals e-trading and distributed ledger technology (DLT). I must also mention the continued importance of sourcing precious metals through responsible supply chains and how the industry is addressing climate change through decarbonisation goals, as we saw at LBMA’s Sustainability and Responsible Sourcing Summit in London in March earlier this year.
The biggest challenge is, in my view, for all parties to strike the right balance between the orderly functioning of the market, the infrastructure changes and the associated changes in the regulatory framework.
The LBMA Regulatory Affairs Committee (RAC) has, and will continue to have, a key role on both sides of that challenge in both understanding market changes and interpreting the associated regulatory updates, and providing guidance to LBMA and its Members in relation to the potential impact and outcome.
LBMA has been that intrinsic link between the market and regulators, advancing market standards and developing market solutions.
So Tobias, moving on to your input at LBMA, where you are Chair of LBMA’s Regulatory Affairs Committee (RAC). How did you first get involved with LBMA and what inspired your involvement with the RAC?
In the early years of my career, I was invited to attend RAC as a delegate, for a colleague. I eventually became the lead standing member and then eventually Chair. I see the committee as a key industry forum for compliance officers from across the industry to discuss the pertinent issues related to our industry. Together, the members of the RAC have years of experience that we can call on, and I continue to be very grateful for all those individuals giving up their time to navigate the germane issues of the day.
What specifically do you bring to the RAC, and how does it help LBMA’s membership?
I try to stimulate the discussion and ensure all RAC members have the opportunity to contribute. I strive to create an inclusive and diverse group who represent as broad a spectrum as possible across the membership, so that those joining feel comfortable to share their own views and experience.
It is important that we continue to recruit new members to maintain the representation of the membership and the diverse profile of the RAC.
I would strongly encourage anyone who is interested in finding out more and joining to contact Graham or me for further details.
I know you were involved in the review of the original version of the Global Precious Metals Code (Code), but what do you think the Code has provided the precious metals industry?
The launch of the Code really was a pivotal moment, not only for LBMA and the industry, but also for me, given I was lucky enough to be involved. For the first time, the precious metals industry had a set of specific principles to promote a number of key standards and best practices expected in the OTC wholesale precious metals market and that have become the industry standard.
It is an industry Code that includes market conventions particular to the precious metals market and its participants. In my view, given the focus on areas around ethics, compliance, governance, risk and trade management, the industry is in a much stronger position for having the Code in place, and perhaps even more so since the recognition of the Code by the UK’s Financial Conduct Authority (FCA) last year.
As you know, the Global Precious Metals Code is currently out for public consultation and is available on LBMA’s website, where anyone interested can find a summary of the proposed changes and how to share any views.
The launch of the Code really was a pivotal moment, not only for LBMA and the industry, but also for me, given I was lucky enough to be involved.
Do you believe the various membership types of LBMA have the same level of compliance issues?
LBMA’s membership is truly diverse in terms of its business and jurisdiction, so a bank may have banking regulations to consider which may differ from location to location, whereas a refiner will, of course, have to think about adherence to Responsible Gold Guidance and the Good Delivery Rules. So, the obligations on each type are different but nonetheless business critical for both, so we on the RAC ensure that all these issues have sufficient opportunity for discussion and debate.
Away from your working day, I assume your young family take up much of your time. But what else do you do in your spare time?
You’re quite right, I don’t have a huge amount of spare time, but I always find time to indulge my passion for discovering new wines. I have been particularly following the explosion of the English and Welsh wine scene in the last five years or so – there are now some spectacular English sparkling wines, and we are starting to see the emergence of some potentially very accomplished reds.
Thanks for your time today Tobias.
Thank you, Graham.
