Monthly Archives: August 2018

FCA publishes final notices on client money

The FCA has published final notices in respect of One Call Insurance Services Limited and its majority shareholder John Radford for breaches in relation to client money and assets in the general insurance and protection sector. The final notices follows the decision notices that we reported on in January 2018. As planned, the FCA has fined […]

FinTech agreement between Dubai and Singapore develops international regulatory co-operation

The Dubai Financial Services Authority (DFSA) and the Singapore Monetary Authority (MAS) have announced that they have entered into an agreement to promote the regulation of innovative businesses.  The agreement allows referrals of FinTech firms between the two authorities, provides a framework for  sharing information on innovation, and also records a commitment to collaborate on […]

ECON calls for equivalence reform

The Committee on Economic and Monetary Affairs has published a report on relationships between the EU and third countries on financial services regulation and supervision. The report calls for a Resolution requiring the Commission to review how current equivalence decision procedures work, to provide greater and clearer transparency, and says there is a clear move […]

HMRC updates on AML civil actions

HMRC has published its guidance on civil measures it can take to address non-compliance with AML requirements.  The guidance looks at HMRC’s role under the 2017 MLRs and how it will use its powers under those Regulations and under the CTA. The note addresses civil measures, but HMRC stresses that it may treat any breach […]

Lisa Osofsky takes over at SFO

Lisa Osofsky has started her 5 year term as SFO Director.

FCA bans individual

FCA has confirmed its ban on Arif Hussein following a decision of the Upper Tribunal published in June.  Mr Hussein was a derivatives trader with UBS, who engaged in internal chats with a UBS trader-submitter knowing that it would be improper to participate in conduct intended to influence UBS’ LIBOR submissions.  FCA found that Mr […]

ESMA renews binary option ban

ESMA has confirmed the ban on binary options will remain in place for a further three months. The current ban, which prohibits marketing, distribution or sale of binary options to retail clients, expires on 2 October. ESMA has reviewed the specific features of certain binary options which make them less risky and as a result […]

Firms’ permissions cancelled for failure to be open and co-operative with the FCA

The FCA has cancelled the Part 4A permissions of two firms, Causeway Group Limited and Prime Render Solutions Limited . The cancellation of the permissions is due to both firms failing to satisfy the suitability Threshold Condition, in that the FCA was not satisfied that the firms are fit and proper persons having regard to all the circumstances, […]

Treasury publishes “no-deal” guidance

Treasury has published guidance for the banking, insurance and other financial services sectors on the impact of what it still describes as an “unlikely” no-deal Brexit scenario. It stresses that increased preparations towards a no-deal were always likely to be necessary the closer Brexit becomes and that accelerating the plans does not mean the Government […]

Regulators launch new campaign to tackle pension scams

The FCA and the Pensions Regulator have launched a joint advertising campaign to raise awareness of pension scams, following research they have conducted which shows that pension scam victims each lost an average of £91,000 in 2017. The campaign, ScamSmart, is aimed at individuals aged 45-65 who are the group most at risk of pension […]

FOS focuses on fraud and scams

FOS’ latest Ombudsman News focuses on frauds and scams. It comments on the loopholes in new technologies that fraudsters use, and the challenges of addressing a complaint where both customer and bank are adamant they are not responsible. FOS notes that although the involvement of a criminal third party makes it hard to determine cases, […]

Pakistan added to MLD4 high risk list

The European Commission has adopted a Delegated Regulation adding Pakistan to the list of high-risk third countries under MLD4.  Member States will be bound to require application of EDD when dealing with any persons from Pakistan. The requirement will take effect 20 days after it is published in the Official Journal.

Treasury publishes CRR Brexit regulations

The latest draft Regulations anticipating Brexit relate to capital resources requirements. The draft Capital Requirements (Amendment)(EU Exit) Regulations 2018 are intended to make sure the CRR can continue to operate effectively once the UK has left the EU. Key changes the draft addresses relate to: group consolidation so as to amend the geographical scope of […]

FCA prosecutes individual for unauthorised investment scheme operation

FCA has started criminal proceedings against Mark Starling for three offences relating to operating CIS without authorisation or exemption over a 9 year period and of fraud.  Mr Starling is alleged to have operated schemes that purported to carry out financial futures trading for investors.

FCA consults on CMC costs and fees

FCA is consulting on how it proposes to set fees to recover its costs for setting up the regulatory regime for claims management companies and for ongoing supervision of the sector. The consultation covers fees under the temporary permissions regime and the ultimate full permissions regime.  FCA plans to recover as many of its costs […]

HM Government publishes Brexit Financial Services framework

The UK Government has published a presentation (dated 25 July) that sets out a proposed ‘Framework for the UK-EU partnership’, as part of the preparations by the UK Brexit negotiating team. This document sets out a proposed model, that would be based on the principle of autonomy, including autonomous judgement over market access, legislation and […]

Law Commission confirms status of electronic signatures

In December 2017 the Law Commission confirmed that one of the projects it would be working on was addressing the absence of explicit case law and legislation that has given rise to uncertainty as to the validity of electronic signatures in some cases. Consequently, the Law Commission has now published early conclusions from its review […]

FOS update on publication of complaints data

The Financial Ombudsman Service (FOS) has published a statement, following its October 2016 Consultation Paper and December 2016 Feedback Statement on complaints data publication. The Feedback Statement included FOS’s commitment to work with stakeholders to explore a new measure of cases received per 100 FCA-reportable complaints, and to report some resolved PPI complaints by volume only […]

FSB launches peer review of LEIs

The Financial Stability Board has published the Summary Terms of Reference of a thematic peer review of the implementation of the Legal Entity Identifier. The thematic review seeks feedback from a range of stakeholders on issues such as: awareness and adoption of the LEI in various jurisdictions; types of private sector uses of the LEI; […]

FCA personal and business current account comparison rules come into force

New FCA rules requiring banks to publish information about personal and business current accounts came into force on 15 August 2018.  The new rules cover standing data relating to account opening and service availability and major incident metrics. Further rules will require firms to publish information about account opening and debit card replacement from 15 […]

ECB publishes the latest version of its Supervision Letter

The European Central Bank (ECB) has published the latest edition of its Supervision Letter. The August edition includes a recording of an interview with Ed Sibley, Deputy Governor of the Central Bank of Ireland and ECB Supervisory Board member, discussing the importance of all forms of diversity to the governance, culture and risk profile of banks. In […]

FCA complaints handling review findings

The FCA has published its findings of the review of how Non-deposit Taking Mortgage Lenders (NDTMLs) and Mortgage Third-Party Administrators (MTPAs) handle complaints. In particular the review looked at how NDTMLs and MTPAs treat their customers, whether their complaint handling arrangements pose any potential consumer harm, and how they could handle complaints better. The FCA found that overall […]

All-Party Parliamentary Group calls for full statutory inquiry into business banking sector

The Co-Chair of the All-Party Parliamentary Group on Fair Business Banking has written to Andrew Bailey of the FCA in the wake of the FCA’s announcement that it was unable to take further action in relation to its investigation of RBS’ treatment of business customers. The letter calls for further information and action on a […]

UK Finance publishes guidance on Funds Transfer Regulation

The industry body UK Finance has developed a voluntary ‘How to’ guide on compliance with the requirements of the Funds Transfer Regulation (also referred to as the Wire Transfer Regulation). The guide aims to assist with an industry-wide harmonised approach to compliance, thereby increasing the efficiency of payment processing. The guidance’s stated aim is to […]

MLD4 Regulation on central contact points published in OJ

Commission Delegated Regulation (EU) 2018/1108 has been published in the OJ. This Regulation sets out RTS relating to the criteria for determining when it may be appropriate to require electronic money issuers and payment service providers who have certain cross-border operations to appoint a central contact point for a particular territory.  The RTS also address the […]

Standard setters consult on incentives for OTC derivatives clearing

The FSB,  Basel Committee, the CPMI and IOSCO have published a joint consultation on incentives to centrally clear OTC derivatives. The organisations want to look at how the post-crisis measures have worked and whether there is a need to fine-tune them. A post-reform evaluation suggests that there are overall good incentives for using central clearing, […]

FCA Dear CEO Letter on cross border arrangements

The FCA has published a Dear CEO letter on cross border booking arrangements. In its letter, the FCA acknowledges that, in order to deal with the UK’s withdrawal from the EU, firms have put in place contingency plans which when executed will impact current business models, legal entity strategies and booking arrangements. The FCA appreciates the […]

EIOPA joins the Sustainable Insurance Forum

The European Insurance and Occupational Pensions Authority (EIOPA) has announced that it has become a member of the Sustainable Insurance Forum (SIF). The SIF is a network of insurance supervisors and regulators from around the world working together on sustainability challenges facing the insurance sector. In July 2018, the SIF, together with the International Association […]

FCA announces GFIN creation

FCA has announced the creation of the Global Financial Innovation Network (GFIN), in collaboration with 11 other regulators and organisations. This builds on FCA’s plans for a global regulatory sandbox and will create a new framework for innovative firms interacting with regulators, and regulators sharing information. FCA has now published a consultation seeking views on […]

ESMA response to EIOPA on AIFMD

ESMA has responded to some queries EIOPA raised with it on the definition of AIF and leverage in the AIFMD.  EIOPA had asked: whether AIFs that use certain borrowing arrangements and derivative instruments under the Solvency II Delegated Regulation considered leveraged for AIFMD purposes. ESMA points out that the AIFMD has no formal definition of […]

ECB publishes draft regulation on money market statistics

The ECB has published a draft Regulation amending the Money Market Statistical Reporting (MMSR) Regulation. Since July 2016, the ECB has used the MMSR Regulation to collect data on the euro money market. In addition, detailed data has been reported by large euro area banks on transactions denominated in euro in the unsecured, secured, foreign exchange […]

FMLC reports on financial contracts post-Brexit

FMLC has published a report looking at contract continuity post-Brexit and highlights the legal uncertainties that will continue if there is no clear agreement on the UK/EU relationship.  The paper, which reprises many views FMLC has already expressed, also looks at how not only legislation but also firms can take measures to mitigate the risks.

Tribunal backs decision to ban

The Upper Tribunal has upheld FCA’s decision to ban Alistair Burns, Director and CF1 of TailorMade Independent Limited, firm that advised on pension transfers and opt-outs, from any significant influence or senior management function because of his lack of competence and capability.  It also directed FCA to fine Mr Burns £60,000 for failing to ensure the […]

FCA publishes interim report on CCA review

The FCA is progressing with its statutory obligation to review the CCA, by publishing an interim report on its review. The interim report sets out the FCA’s initial views on whether the repeal of CCA provisions would adversely affect consumers. Comments are requested by 2 November 2018; the final report must be delivered by 1 April 2019. […]

Tribunal rules on Validation Order on credit agreements brokered by unauthorised firm

The Tribunal has handed down its decision in the case of Plexedes Chickombe and 44 others v the FCA and Clydesdale Financial Services Limited trading as Barclays Partner Finance (Clydesdale) as interested party. The case concerned consumer credit agreements that were entered into through an unauthorised broker. Clydesdale had discovered that 1,444 regulated credit agreements to finance the […]

Consultation on use of digital technology in insurance

The International Association of Insurance Supervisors has published a draft issues paper on the increasing use of digital technology in insurance and its potential impact on consumer outcomes. The focus of the paper is on product design, underwriting and distribution. The paper notes the potential for advances in digitalisation to impact fair customer outcomes, including […]

FCA publishes evaluation of GAP insurance intervention

Following its intervention in the add-on GAP insurance market in September 2015, the FCA has published an evaluation of the effect of its measures. The measures introduced by the FCA were designed to address the harms identified in its Market Study of July 2014.  Their findings then were that the sale of GAP insurance as […]

Extension of SM&CR to insurers: PRA consults on implementation

The PRA is consulting on proposed changes to its Rulebook, to provide for: a technical correction to the Solvency II firms: Insurance General Application Part; and consequential changes and minor administrative amendments relating to the extension of the SM&CR to insurers. The proposed amendments include the application of an ‘overlap’ rule for individuals with ‘FCA […]

FCA consults on general standards and communication rules for payment services and e-money

The FCA has published a consultation paper on rules and guidance to improve conduct and communication in the payment services and e-money sectors. Currently, payment service providers and e-money issuers are subject to different regulatory requirements, as both FSMA and non-FSMA firms operate in these sectors. The FCA has recognised that this creates a mismatch […]

PSR reports on contactless mobile payments

The Payment Systems Regulator has published a report on contactless mobile payments (CMPs). It sees this as a growth area as people become more comfortable with using it, more contactless pay-points are available and functionality improves. As a result, it wanted to be sure it understood relevant issues and the effects of the sector on […]

FCA updates on high-risk products and retail investors

FCA has added its own views on selling high-risk speculative investments to retail clients. It fully supports ESMA’s measures and notes that ESMA has also recognised the risks of products similar to CFDs. However, it is concerned firms will try to get around the ESMA product intervention restrictions by selling to retail investors products that […]

FCA confirms no action will be taken against RBS for treatment of SME customers

The FCA has published an update on its investigation into RBS’s treatment of small and medium-sized enterprise (SME) customers transferred to its Global Restructuring Group (GRG). The FCA commissioned an independent review in 2014 and found that RBS’s GRG unit had systematically mistreated customers. However, the FCA has now confirmed that it has no power to take […]

ESMA updates product intervention FAQs

ESMA has updated its FAQs on the use of its temporary product intervention measures in respect of CFDs and binary options.  New questions: state that turbo certificates are not within the scope of the CFD decision as they have different product features to CFDs, including that they are transferable securities for MiFID purposes and are […]

Mortgage Lenders agree on common standards to help longstanding borrowers

UK Finance has announced that together with the Building Societies Association and the Intermediary Mortgage Lenders Association, it has agreed common standards to help existing mortgage borrowers on a lender’s reversion rates to switch to a better deal in certain circumstances. The cross-industry commitment follows the FCA’s Mortgage Market Study interim report, which identified a small […]

Where next for SARs?

We have written an article on the Law Commission’s Consultation paper on changes to the SARs regime.

Sanctions and AML Act article

We have written an article setting out the detail of the Sanctions and AML Act.