Monthly Archives: February 2018

FCA updates on consumer credit landscape

Andrew Bailey has spoken to the FLA on the current consumer credit landscape. He noted the constant fall in the real cost of debt which has supported the rise in household borrowing, and the growth in consumer credit particularly among the young. FCA has carried out several pieces of research to determine who is driving the growth […]

Treasury Committee concerned at GRG “rebrand”

The Treasury Committee is concerned at evidence RBS has provided to it that indicates that 75% of current RBS restructuring employees previously worked in the GRG. Nicky Morgan said that although Ross McEwen, RBS Chief Executive, had assured the Committee that the culture in the current Restructuring group is fundamentally different to that of the […]

Payment Systems Regulator confirms plans to protect victims of payment scams

The Payment Services Regulator (PSR) has announced the outcome of its consultation on the introduction of a contingent reimbursement model for victims of authorised push payment (APP) scams. In summary: an industry code will be in place by September 2018, paving the way for victims of APP scams to have better protection; consumer groups and […]

Treasury updates AML advisory

Treasury has published an updated AML advisory notice reminding firms of their obligation to apply EDD for higher risk jurisdictions.  It has produced a table of relevant jurisdictions, showing which ones it recommends firms consider as: high risk and apply countermeasures and EDD measures in accordance with the risks (North Korea) high risk and apply EDD […]

PRA responds to Treasury Committee’s inquiry into Solvency 2

PRA has published a report in response to the Treasury Committee’s inquiry into Solvency 2. The response is split into four parts: Part 1: Overview of the UK insurance industry and the rationale for the prudential regulation of insurers. Part 2: Solvency 2 and the UK insurance sector, including the development of Solvency 2. Part 3: […]

BoE speech on looking out for the policyholder

Sam Woods, Deputy Governor, Prudential Regulation and Chief Executive Officer of PRA delivered a speech entitled ‘Looking out for the policyholder’ at the ABI’s annual conference. The speech focused on the policyholder, competition and competitiveness and Solvency 2 reform. With regard to PRA’s secondary objective to facilitate effective competition, Mr Woods provided practical examples of steps […]

The FCA fines Vanquis £1,976,000 for failure to disclose full price of an add-on product

The FCA has fined credit card lender, Vanquis, £1,976,000 and ordered it to pay compensation to customers for failing to disclose the full price of an add-on product called Repayment Option Plan. In particular, the FCA found that Vanquis breached Principle 6 (Customers’ interests) and Principle 7 (Communications with clients) of the FCA’s Principles for […]

FCA publishes its final policy statement on new rules for the credit card market

Following a comprehensive study of the credit card market, the FCA has published its final policy statement on new rules for the credit card market. The new rules aim to provide more protection for credit card customers in persistent debt or at the risk of financial difficulty. Firms will be required to take series of […]

Summary of responses to the ECB’s first public consultation on developing a euro secured overnight interest rate

The European Central Bank has published a summary of responses it received following its first consultation paper on a new euro unsecured overnight interest rate, published in November 2017. Responses include: a vast majority of respondents agreed with the definition suggested in the consultation document and expected the rate to be generally accepted by the public as […]

FCA Statement on proposals to introduce a public register

The FCA has published a statement  announcing that it will consult on proposals to make information available on a wider range of individuals at authorised firms. Under the FCA’s proposals to extend the Senior Managers and Certification Regime, the FCA will only approve the most senior individuals within firms, resulting in only senior managers appearing […]

FCA makes new rules

FCA’s latest Handbook Notice confirms changes to: FEES to ensure the life and pensions intermediation class can still benefit from support from the retail pool SUP to align the Financial Crime Annual Return to the MLRs and PEP guidance. The changes seek to make the terminology in the various measures consistent and guard against firms […]

FCA finalises perimeter guidance on personal recommendations

FCA has published a policy statement setting out its feedback on what is a “personal recommendation” in relation to retail investments, as part of its work on the FAMR. The new guidance, which will be in PERG, is aimed in part at reassuring firms that there is information they can give clients, and can even […]

BSB publishes fit and proper guidance

The Banking Standards Board has published some supporting guidance to its principles on fitness and propriety assessments.  It focuses on helping firms identify and deal with the risks and issues that may arise when they are carrying out the fit and proper assessment of their certified staff. The guidance addresses establishing pass/fail criteria and evidencing […]

PRA updates on IDD and occasional consultation

PRA has published an update on responses to certain parts of its CP18/17 Occasional consultation. The update explains how PRA prepared to bring into force rulebook changes relating to the implementation of the Benchmark Regulation, MiFID 2 and the IDD, pending completion of relevant legislative changes.

CMA updates on investment consultants investigation

The CMA has published an update of its progress on its market investigation into investment consultants and fiduciary managers.  Since it started its reference last September, it has, among other things, visited three large investment consultants and held hearings with a range of providers and stakeholders. It has also completed a large quantitative survey of […]

Treasury launches digital currencies inquiry

Treasury has announced an inquiry into the role of digital currencies in the UK. It will look at DLT and its potential impact on financial institutions and the infrastructure, and will look at the regulatory response to date.

BoE publishes annual report on FMI supervision

The Bank of England has published a report on its supervision of financial market infrastructures (FMI). The report measures performance against its 2017 annual report, as well as looking ahead. The report: Defines FMIs and their importance; Explains BoE’s supervisory role and BoE’s interaction with national and international regulators; Reports on BoE’s supervision over the […]

AFME publishes Brexit guidance on wholesale FS contracts

The Association for Financial Markets in Europe (AFME), has published a guide on the impact of Brexit on wholesale financial services contracts. The guide takes the form of FAQs and is intended to help clients of banks in understanding how cross-border relationships will be affected by the UK’s decision to leave the EU and, by […]

UK Finance positive on MiFID 2

UK Finance reports that initial impressions of MiFID 2 implementation are that it has been smoother than expected.  While there have been some teething problems and outstanding issues, firms seem, generally, to have been able to adapt within the implementation deadline.

BCBS report on the implications of fintech developments for banks and bank supervisors

The Basel Committee on Banking Supervision has published a report on the implications of fintech developments for banks and bank supervisors. The report assesses how technology-driven innovation in financial services (fintech) may affect the banking industry and the activities of supervisors in the short to medium term.    

TIA launches asset management accelerator

The Investment Association has announced its new FinTech accelerator for the asset management industry, to be called Velocity. It will launch later this year and will take two cohorts per year of between 4-8 firms, and help them to turn their technology into business-ready solutions.

FCA writes to CEOs on prudential returns

FCA has published a “Dear CEO” letter setting out its comments on the quality of prudential returns. It is concerned that a significant number of firms are submitting returns that contain inaccurate or incomplete data and, as a result, feels it needs to ask CEOs of IFPRU and BIPRU firms to review their firms’ regulatory […]

Sanctions and AML Bill progresses

The Sanctions and AML Bill has heard its second reading in the Commons and now passes to the Public Bill Committee stage on a date not yet announced.

Tribunal rules on third party rights

The Tribunal has handed down its decision in One Insurance Ltd’s case against FCA. The company had complained that FCA had identified it in its notices to One Call Insurance Services and John Radford, and that the notices contained statements that were prejudicial to the company.  Because One Call had inadvertently wrongly used client moneys, […]

FCA and CFTC sign FinTech MoU

FCA and the US CFTC have signed a memorandum of understanding to collaborate on FinTech initiatives powered through FCA’s Innovate and CFTC’s LabCFTC processes.

FCA seeks views on tech in reporting

FCA has launched a call for input on using technology to make regulatory reporting easier. It refers to its 2017 “TechSprint” in which it brought together firms and technology companies to look at challenges and solutions. The meeting came up with a proof of concept to make regulatory reporting requirements machine-readable and executable. The Call […]

SME finance inquiry launched by Treasury Committee

The Treasury Committee has opened an inquiry into small and medium sized enterprise finance, addressing lessons learned from RBS’ Global Restructuring Group, and the state of the market for SME finance. The inquiry seeks to consider: The extent of competition in the SME finance market; The sources of funding available to SMEs, including crowdfunding and […]

Treasury Committee publishes RBS report

The Treasury Committee has published the final, unredacted skilled persons’ report into the RBS treatment of SME customers in its Global Restructuring Group. It had given FCA until 16 February to publish this, but FCA did not do so and therefore the Treasury Committee has now done it.

FCA reminds firms on pensions transfer advice

FCA has published a letter from Megan Butler reminding firms of FCA’s expectations when they are advising on pension transfers. The letter contains details of key publications from FCA on the topic.

FCA updates on service standards

FCA’s new-look update on its service standards shows that it met most of its targets for various regulatory tasks, including authorisations, passport notifications, dealing with queries and customer satisfaction. However, it did fall slightly short on some applications, particularly consumer-credit related ones, and some of its work on passports.

Council agrees IDD delay

EU ambassadors have confirmed, on behalf of the Council, that the transposition deadline for the IDD should be delayed until 1 July, and the application date to 1 October.  The EP and Council, however, are not expected to adopt the necessary amending Directive until March, after the 23 February transposition date, so that the delay […]

FCA consults on global sandbox

FCA’s regulatory sandbox has supported 60 firms with innovative ideas since its launch in 2016. To date, it has allowed firms to conduct tests in the UK only, but FCA is now planning to expand it and is seeking views on the creation of a global sandbox. This would allow firms to conduct tests in […]

FCA AND PRA APPOINT NEW CHAIR OF THE FSCS

The FCA and PRA have today announced the appointed of Marshall Bailey as the new Chair of the Financial Services Compensation Scheme Limited (FSCS) with effect from 1 April 2018. Marshall Bailey succeeds Lawrence Churchill, who is stepping down after 2 terms as Chair.

The three ESAs warn consumers on the risk of virtual currencies

The three ESAs (consisting of the European Securities and Markets Authority, the European Banking Authority and the European Insurance and Occupational Pensions Authority) issued a warning to consumers on the high risks of buying and/or holding virtual currencies such as Bitcoin, Ether and Ripple (VCs). The warning follows the fact that there has been an increasing number […]

Further SFO charges in Barclays case

The Serious Fraud Office (SFO) has charged Barclays Bank Plc (Barclays) with unlawful financial assistance contrary to s151(1) and (3) of the Companies Act 1985. This relates to the financial assistance Barclays gave to Qatar Holdings LLC between 1 October and 30 November 2008, in the form of a US$3 billion loan, for the purpose of acquiring […]

The standards of lending practice for personal customers review

The Lending Standards Boards (LSB) has announced that it intends to review the Standards of Lending Practice for personal customers (Standards). The LSB is seeking input from registered firms, industry bodies, consumer and debt bodies, and other relevant parties whose work may interact with the LBS to help it consider whether updates to the Standards […]

Illegal money lender imprisoned

An illegal money lender has been sentenced to imprisonment of 3.5 years for offences under FSMA and the CCA. In addition to bringing the successful prosecution against Dharam Gopee, FCA also successfully obtained a Serious Crime Prevention Order against him. Mr Gopee was refused a consumer credit licence by the OFT and did not get […]

Insurance Europe publishes Brexit position papers

Insurance Europe has published two position papers relating to Brexit. The first paper discusses the need for a transitional arrangement, stating that such an arrangement is crucial for business continuity until legal clarity on the future UK-EU relationship is reached. Any transitional arrangement should ensure the UK remains covered by EU law and its supervisory framework […]

ESMA publishes 2018 Risk Assessment Work Programme

ESMA has published its Risk Assessment Work Programme for 2018, in which it establishes priorities for assessing securities market risks. ESMA will complement ongoing market monitoring through its semi-annual Report on Trends, Risks and Vulnerabilities, and its Quarterly Risk Dashboards, by launching an annual series on EU derivatives markets (based on EMIR data) and an […]

Commission launches AIFMD survey

The European Commission is carrying out a survey on how the AIFMD has worked in practice and how it has met its objectives.  Anyone can respond to the online survey.

Commission updates Brexit pages

The European Commission has updated its website to provide information on how Brexit will affect banking and finance rules. Separate pages address: markets in financial instruments banking and payment services post-trade issues asset management credit rating agencies insurance and reinsurance and statutory audit Each page looks at the impact of withdrawal on authorisations, contracts and […]

FCA and ICO update on GDPR

An update from FCA and the ICO confirms FCA’s view that firms can comply with both the GDPR and its rules. The update notes that GDPR is a board level responsibility, and firms must produce evidence to show what they have done to comply with it. FCA also notes that, although the ICO will regulate […]

Court dismisses appeal against spread-bet losses

The Court of Appeal has dismissed an appeal by a customer of a spread-betting company (IG Index), who claimed IG Index’s failure to close out in accordance with its terms of business caused him to incur greater losses than need have been the case. IG Index’s terms said, among other things, that it had absolute […]

FCA explains perimeter to Treasury Committee

Andrew Bailey has written to the Treasury Select Committee setting out a summary of the powers “FCA does not have”. It has been asked many questions in the context of the RBS GRG investigation. The letter sets out: FCA’s basic remit over regulated activities and its role as the UKLA as well as its powers […]

ESMA updates MiFID 2 FAQ

ESMA has updated its Q&As on transparency and market structure issues under MiFID 2. The latest additions cover pre-trade transparency waivers.

MEPs agree MLD4 blacklist additions

MEPs have approved the proposal to add Tunisia, Sri Lanka and Trinidad and Tobago to the list of high-risk third country jurisdictions under MLD4. The vote passed the additions, despite continuing dissatisfaction among many MEPs over the inclusion of Tunisia.

PRA publishes policy statement on strengthening individual accountability in insurance

PRA has published a policy statement on strengthening individual accountability in insurance: optimisations to the SIMR. The policy statement follows on from an ealier consultation (CP8/17) and includes: feedback on the proposed optimisations to the SIMR and PRA’s final policy; feedback on PRA’s proposals for diversity at boards of insurers and PRA’s final policy; the […]

ESMA UPDATES Q&As

The European Securities and Markets Authority (ESMA) has issued updates of its Q&As on: the implementation of the European Markets Infrastructure Regulation (EMIR). The purpose of the document is to promote common supervisory approaches and practices in the application of EMIR; the implementation of the Central Securities Depository Regulation (CSDR). The Q&A provides common answers […]

FCA speech – The future of the city

On 5 February 2018, Andrew Bailey, FCA Chief Executive, delivered a speech, the Future of the City, which focuses on the transition to Brexit and the future of the UK regulatory regime. Key highlights include: the FCA is treating Brexit as a high priority and the FCA will do its utmost to ensure that it works […]

The UK’s developing cyber insurance market

We have written an article that assesses the UK’s developing cyber insurance market in the context of the changing regulatory landscape and looks at the possible benefits and risks associated with the proposal to share data breach information between insurers and the ICO.

Book your place on financial crime prevention course!

We are hosting and presenting  the morning session of the Financial Crime Compliance Certification course on 14 March. Suitable for senior managers needing a broad understanding of financial crime prevention laws and regulatory expectations, those new to the area and anyone else needing a refresher. Places limited, please book through the Compliance Register.

FCA consults on implementation of EU Benchmarks Regulation

FCA has published a consultation paper on Handbook changes necessary as a result of the EU Benchmarks Regulation and the UK Benchmarks Regulations 2018. Specifically, it plans changes to DEPP and EG FCA proposes to apply its existing policy and procedure to the exercise of its enforcement powers under the Benchmarks Regulation. FCA also proposes […]

PRA consults on changes relating to IDD commencement date

The PRA has published a consultation paper on amending the effective date of its rules implementing the IDD, in response to proposals from the European Commission to push IDD implementation back from 23 February 2018 to 1 October 2018. Proposals to amend the effective date to align with the Commission proposal do not represent a […]

Treasury delays transposition of IDD until the application date is confirmed

The European Parliament and European Council are considering the proposal to delay the application date of IDD until 1 October 2018. The Treasury has updated its webpage to explain that it will delay making the Insurance Distribution (Regulated Activities and Miscellaneous Amendments) Order 2018 until the proposal to delay the application date is confirmed. This […]

EU Blockchain Observatory and Forum launched

The European Commission has announced the launch of an EU Blockchain Observatory and Forum. This aims to: highlight key developments in blockchain technology; promote European participants; and reinforce European engagement with key stakeholders. It is mandated to gather information, monitor and analyse trends, address challenges and explore blockchains’ socioeconomic potential, by facilitating cross border cooperation […]

EIOPA consults on adaptation of requirements for insurance intermediaries’ PII and financial capacity

The Insurance Distribution Directive sets out in Article 10 base amounts of PII and minimum financial cover required by insurance and reinsurance intermediaries. It also requires EIOPA to review the prescribed levels of cover by 31 December 2017 and every five years thereafter, in order to take account of changes in the European index of […]

FCA review of Board Effectiveness

The FCA has published a report of the independent review into the effectiveness of its Board. The review was undertaken by Independent Audit Limited. The review involved interviews with Board members, a review of documentation and observance of Board and committee meetings. The report also sets out the following broad themes: aligning of activities into […]

EBA starts 2018 stress test

EBA has launched the 2018 stress test. It will cover 48 banks and EBA expects to publish the results in early November.