ESMA has updated its Q&As on investor protection issues under MiFID 2 and MiFIR. The changes specifically address what is an “acceptable minor non-monetary benefit” for the purposes of the inducements...
Author - Emma Radmore
Emma Radmore
IOSCO consults on outsourcing principles
IOSCO has published a consultation paper on updating its guidance on the principles of outsourcing. It delayed publishing the consultation because of Covid-19 but now feels it is right to publish it, not least because...
OFSI reports on TAFA
OFSI has submitted its latest quarterly report to Parliament on the operation of the UK asset freezing regime under TAFA. The report covers the quarter to the end of 2019 and notes: only £9,000 of funds were frozen...
EU Crowdfunding Regulation – investor protection aspects
We’ve now published the second part of our review of the proposed EU Crowdfunding Regulation, looking at the investor protection aspects.
FCA updates on CPD and Covid-19
FCA has previously said that is expects firm to be able to show that individuals are competent to carry out their work during the pandemic. It notes that effective and consistent CPD is a part of this, but that it is...
UK Finance comments on FCA mortgage proposals
UK Finance has responded to FCA’s consultation on what firms should be doing as the next stage of helping customers in financial difficulties due to Covid-19 with their mortgages. While, of course, UK...
Green guide for supervisors
The Network for Greening the Financial System has published a guide for central banks and supervisors, looking at how financial institutions have worked with green, non-green and brown financial assets, and how...
Market Watch Covid special
FCA’s latest edition of Market Watch looks at market conduct and discipline in the context of coronavirus. It stresses particularly the importance of complying with the standards of MAR. Given the likely need for...
FCA makes new rules
At FCA’s May Board Meeting it made 3 new sets of rules: the Covid-19 Premium Finance Instrument, which took effect from 18 May and introduced the new requirements on payment deferrals and other measures for...
Regulator Covid-19 update 22 May
After a relatively quiet week, on 22 May: FCA announced further support for customers struggling to pay mortgages due to Covid-19. It is consulting on what options firms will need to provide to customers reaching the...
FSCS announces 2020/21 levy
FSCS has announced its levy for 2020/2021 at £649m. This is £14m more than forecast in the plan and budget, mainly to reflect estimated compensation costs for LCF opf £44m which will be borne by the Life Distribution...
CMA updates on anti-competitive FS practices
The CMA has updated on progress in its investigations on anti-competitive arrangements in the financial services sector. The initial investigation, which started with information gathering in November 2018, and have...
FCA responds on economic impact of Covid-19
The Treasury Committee has published a copy of a letter from FCA answering its questions on the economic impact of Covid-19. The letter explains: the steps FCA has taken to ensure the credit ratings of customers taking...
Court clarifies SIPP providers’ DD obligations
A landmark case decision, in Adams v Options SIPP UK LLP has considered the duties SIPP providers owe to investors. In this case, a SIPP provider facilitated an investment on an execution-only basis for an investor who...
EP updates on MLD4 high-risk list
The European Parliament’s legislative observatory notes that the revised MLD4 high-risk third country list is now awaiting a committee decision. Meanwhile, the UK is among 9 jurisdictions from whom the Commission...
Government publishes draft EU/UK FTA
The Government has published a draft Comprehensive Free Trade Agreement between the UK and EU. Chapter 17 of the agreement relates to financial services, which it defines as “any service of a financial nature...
JMLSG consults on pooled client accounts
JMLSG is consulting on some new draft text for Chapter 5 of Part 1 of its guidance dealing with pooled client accounts. JMLSG considers the key risks of PCAs are where a customer’s clients misuse a PCA without the...
FCA updates on Innovation Hub help
FCA has updated its information on requesting Innovation Hub support in light of Covid-19. It wants to hear from firms who have creative and innovative solutions to the challenges the virus is posing, and is...
FCA clarifies paper issues during Covid-19
FCA has set out its expectations on how firms should deal with post and paper-based processes during the pandemic. It says it recognises firms will be finding it hard to process post and comply with paper-based...
EBA addresses financial crime risks of dividend arbitrage
EBA has conducted an inquiry into dividend arbitrage trading schemes. It concluded that differences in domestic tax laws mean that national authorities do not share the same understanding of these schemes. As a result...
NCA updates guidance on better SARs
NCA has published an update to its guidance on how to submit better quality SARs, and a set of FAQs to accompany it. The guidance stresses that a properly made SAR will give the enforcement agencies a quick picture of...
FCA updates on Covid-19 and complaints
FCA has updated its webpage on how firms should be handling consumers’ complaints during Covid-19. The page explains that FCA has asked firms to prioritise making payments where consumers have accepted offers or...
Government agrees cross-border information sharing
The Government has endorsed cross-border information sharing within corporate groups as a weapon to combat financial crime. The Government says sharing can help both the private sector and government agencies, but where...
Covid-19 insurance rules to take effect from 15 May
FCA has updated its website to state that its new guidance for insurance and premium finance firms for dealing with customers in temporary financial difficulty due to Covid-19 will now take effect from 15 May (not 13 as...
EU launches AML policy
The European Commission has adopted an action plan for an EU policy on preventing money laundering and terrorist financing. It wants to deliver, by early 2021: effective implementation of existing rules a single EU...
FCA gives lending application guidance
FCA has updated its webpages giving guidance to applicants for authorisation, The latest updated page includes a sample business plan for consumer credit business, with guidance for different types of firms, and...
FCA sets out planned initiatives
FCA has published a grid prepared by the Financial Services Regulatory Initiatives Forum setting out the regulatory pipeline for the next 12 months. The forum comprises FCA, PRA, BoE, the PSR and the CMA, with Treasury...
FCA speaks on response to Covid-19 and Brexit
Nausicaa Delfas has spoken on FCA’s national and international response to Covid-19 and Brexit. On Covid-19, she noted: FCA’s priority to keep markets open and orderly, help firms continue to operate...
FCA sets Covid-19 financial crime prevention expectations
FCA has set out the systems and controls it expects firms to have in place to continue to manage their financial crime risks during Covid-19. It appreciates firms will face operational challenges, but also notes that...
Complaints Commissioner decides on Connaught Complaint
The Complaints Commissioner has published his decision in relation to complaint brought by Mark Bishop about the actions of the FCA’s Chair and Chief Executive in relation to the establishment of the independent...
Regulator Covid-19 update 6 May: SMCR, financial crime systems and other updates
On 6 May: FCA published a modification by consent and a direction to enable all solo-regulated firms to arrange for an unapproved senior manager to cover SMFs in an emergency, from the normal 12 weeks to 36 weeks, as...
Government sets out equivalence views
John Glen has written to the Chair of the European Scrutiny Committee explaining the Government’s stance on equivalence in financial services. The Government cannot provide great detail given the early stage of...
FATF updates on Covid-19 risks
FATF has considered the financial crime risks that Covid-19 has created, and is looking at how to address them. It is particularly concerned at, for example, how criminals may seek to bypass CDD measures, use online...
Covid-19: access to restricted savings
FCA has updated its Covid-19 information for firms in respect of consumers needing to access restricted savings. Research shows that over 20% of consumers have had to access their savings recently, and that several...
FCA pilots digital sandbox
FCA has announced a pilot of a digital sandbox to give support to innovative firms that are tackling challenges caused by Covid-19. It is asking for expressions of interest before opening applications later in the...
Industry welcomes FCA business interruption insurance action
Industry associations have welcomed FCA’s initiative to seek Court declarations on aspects of business interruption insurance cover. The ABI commented that, although the vast majority of policies do not cover...
Up next from FCA
Unsurprisingly, FCA’s recent publications have almost exclusively focused on Covid-19. However, in BAU, it still proposes: a consultation on exit fees on investment platforms and comparable firms over the summer;...
Regulator Covid-19 update 1 May
On 1 May, FCA: announced proposals for a Court declaration on business interruption claims proposed guidance for insurers on assessing whether products still offer value and appropriate action to take where they do not...
FCA publishes skilled person data
FCA has publicised the number of skilled persons reports commissioned in January to March 2020. It commissioned 24 in total, of which 9 related to retail banking and 6 to retail lending. 6 of the reports were on...
Tribunal rules against FCA on cancellation decision
The Tribunal has ruled on a case brought by Financial Services (Euro) Ltd against FCA. FCA had decided to cancel the firm’s permission because it had no PII cover. The firm contended that FCA was aware that the...
PRA agrees time-limited SMF approval
PRA has agreed that an individual currently approved to the Chair role at four insurance entities within the Bank of Scotland/Lloyds Bank group (and an approved NED of the two banks pre-SMCR) may take on the SMF10 role...
UK and Switzerland work to strengthen ties
Economiesuisse and The CityUK have been working on a joint position paper setting out how to strengthen the countries’ relationship in the time of coronavirus and in the future. In terms of financial services, the...
EFAMA calls for urgent PRIIPs KID changes
EFAMA is adamant that the Covid-19 crisis makes it all the more important for action to be taken quickly on revisions to the PRIIPs KID, which it has long argued is “fundamentally flawed”. It says the...
Commission approves Green Finance position
The European Commission has sent a Communication to the Parliament on the sustainable finance initiative. It explains the background to the “taxonomy” for the common classification system, and the areas on...
FCA publishes report on PPI complaint deadline
FCA has published its final report on the impact of the deadline for PPI complaints. It concludes that its 2 year communications campaign led to a significant increase in consumer awareness of the deadline and...
Treasury Committee progresses Covid-19 inquiry
Following its call for evidence on 18 March, the Treasury Committee now has terms of reference for its inquiry into the economic impact of Covid-19 and will be looking at the operational effectiveness, cost and...
Financial Services Bill measures
I wrote an article for Compliance Monitor on the current consultations and plans for financial services regulation under the Financial Services Bill initiative.
Regulator Covid-19 update 22 April
On 22 April FCA published a new webpage on PII cover for financial advisers. It recognises that firms may be concerned about their ability to renew their PII during the Covid-19 crisis, which may impact on their...
Regulator Covid-19 update 21 April
FCA has updated its information page for firms, in respect of professional qualification exams. It notes that while professional exams are being cancelled, firms must still ensure employees have the skills, knowledge...
PRA updates on skilled persons reports
PRA has published details of the skilled persons reports it commissioned in Q3 2019/20. There were 8 in total, of which 3 related to technology and information management in banks, and 2 to controls and risk management...
Wolfsberg Group updates CBDDQ
The Wolfsberg Group has updated its Correspondent Banking DDQ and supporting documents. The changes update the documents and focus on ease of use and readability.
Council publishes EU Crowdfunding Regulation compromise text
In March the European Commission submitted two legislative proposals to the Council of the European Union (“the Council“). The final compromise text of the proposals has now been published: Proposal for a...
Regulator Covid-19 update 17 April
In addition to FCA’s consultation on further measures to help consumers who have motor finance or high cost credit products, covering motor finance, rent-to-own, BNPL and pawnbroking and HCSTC, it has also updated...
FCA updates on funds expectations
FCA has updated its website in respect of funds and Covid-19. It has added sections on: its flexibility around statements on 10% portfolio value reporting – which is the same as for retail business as outlined by...
FOS updates on Covid-19 activities
The latest edition of Ombudsman News focuses on: how it is working to help complainants during the Covid-19 crisis, including on how it has changed its helpline hours – for which it apologises but asks that it...
TI disappointed at UWO overturning
Transparency International has expressed its disappointment at the High Court’s decision to dismiss UWOs that would have required family members of the former Kazakh President to explain how they acquired £80m of...
Regulator Covid-19 update 9 April
On 9 April, in addition to FCA’s confirmation of its new measures to help retail banking customers: ESMA told national regulators to adopt a risk-based approach where fund managers are unable to prepare periodic...
Regulator Covid-19 Update 8 April
On 8 April: PRA welcomed the decision by some insurance companies to pause dividends. The decisions followed PRA’s letter of 31 March; PRA’s credit union supervision team wrote to firms explaining...
FCA consults on fees
FCA has published its fees and levies proposals for 2020/2021. Covid-19 has affected FCA’s plans, and it is taking action to protect small and medium sized firms from the burden of regulatory fees. Comments are...
Regulator Covid-19 Update 7 April
Regulatory fatigue may be starting to set in, as there were fewer regulatory announcements directly consequent on Covid-19 on 7 April. FCA made its rules on deferring commencement of various handbook provisions on...
FCA updates on SMCR Covid-19 expectations
FCA has published further guidance for solo-regulated firms on its expectations in relation to the SMCR and Covid-19. The guidance mirrors the guidance issued by PRA and FCA for dual-regulated firms but additionally...
Regulator Covid-19 update 3 April
On 3 April: PRA and FCA updated dual-regulated firms on how their should deal with furloughing and compliance with the SMCR; EBA published guidelines on the criteria for public and private moratoria applied before 30...
Regulators clarify SMCR obligations during Covid-19
PRA and FCA set out their expectations on dual-regulated firms under the SMCR. The regulators say they recognise firms will have to keep their governance arrangements under review, and intend to be flexible. It notes...
Regulator Covid-19 Update 2 April
On 2 April, the main regulatory initiative was FCA’s emergency consultation on consumer protection measures in the regulated lending markets. Also: PRA and Treasury confirmed the delay of Basel 3.1 by one year...
Parliament Committee seeks equivalence answers
The Third Report of Session of the House of Commons European Scrutiny Committee seeks clarification on the Government’s intentions for negotiations of equivalence arrangements with the EU from the end of the...
ESMA publishes MiFID 2 reports
ESMA has published 2 reports on the impact of MiFID 2: advice to the Commission on the impact of the inducements and costs and charges disclosure requirements: despite some respondents to its consultation proposing...
FOS confirms case fees and releases 2020/21 budget
FCA has confirmed FOS’ 2020/21 budget. Key elements include: continuing to allow 25 “fee” cases for firms outside the group account fee arrangement – so 90% of firms will pay no case fees; 50...
FCA writes to retail firm CEOs on Covid-19
FCA has written a Dear CEO letter to firms that provide services to retail investors. It notes that it has received hundreds of requests from trade associations and firms for it to adapt its regulatory approach, and...
OFSI fines Standard Chartered £20m for sanctions breaches
OFSI has published details of two monetary penalties totalling £20.47m on Standard Chartered Bank for breaches of sanctions against Ukraine, following a voluntary disclosure by the bank. OFSI levied two separate fines...
Regulator Covid-19 update 30 March
The regulators were quite quiet on 30 March with the key update being FCA’s statement on work-related travel and the responsibilities of senior managers – in relation to which it has stressed its support for...
Lords calls for UK/EU cooperation
The House of Lords EU Financial Affairs Committee has written to Rishi Sunak urging the government to set up a structured dialogue with the EU that will support cross-border financial services. It wants: to minimise...
Regulator Covid-19 Update 27 March including key worker update
On 27 March: FCA restated its expectation that firms have in place tested contingency plans to deal with major events and that the plans have been tested. In ensuring this, FCA and the BoE will actively monitor firms’...
FCA Covid-19 response to date
FCA is constantly updating its website on its response to Covid-19. We have also written an article summarising this advice at at the morning of 26 March. The FIN team will keep updating items as appropriate within...
LSB gives business lending practice examples
LBS has published an updated guide for firms, setting out examples of the approach they may wish to consider on product sales, to be compliant with the Standards of Lending Practice for business customers. The guidance...
FCA updates mortgage firm Covid-19 guidance
FCA had provided additional guidance to mortgage firms on payment holidays relating to Covid-19. We reported in this post on the original guidance. FCA has previously required firms to offer payment holidays if they...
FCA delays Directory publication
FCA had been due to publish the initial directory of certified and assessed persons on its Register at the end of March, but is now delaying it for at least a month. Dual-regulated firms had had to submit their data for...
Regulator Covid-19 Update 26 March
On 26 March: FCA, while confirming its intention to be flexible to allow firms to keep operating, noted that they should also be planning ahead and ensuring sound management of their financial resources. It says buffers...
Regulators give leeway on company accounts
The FRC, PRA and FCA have announced a series of actions to help listed companies during the Covid-19 crisis. Listed companies may have an additional 2 months to publish audited financial statements. But issuers are...
Government confirms extension of TTP
In a statement to Parliament, Lord Agnew of Oulton, the Minister of State, has noted a statement from Treasury that it expects “in general” the same laws and rules to apply as the transition period ends, it...
Covid-19 regulator update 24 March
Late on 23 and on 24 March: PRA announced amendments to regulatory reporting for insurers in response to EIOPA’s recommendations. There will be between 2-8 weeks’ delay for most aspects of harmonised...
ESMA extends response dates
ESMA has extended the response date of all consultations due to close on or after 16 March by 4 weeks. This includes the consultation on technical standards for the provision of investment services and activities in the...
FSCS comments on LCF judicial review
As a judicial review action starts in respect of eligibility of London Capital & Finance investors for FSCS payment, FSCS commented that this is a large case, and that it had carried out extensive factual...
Covid Corporate Financing Facility exempt from FSMA
Treasury has made legislation to exempt the Government’s Covid Corporate Financing Facility from the need for authorisation under FSMA (except in relation to insurance business – which it is not proposed the...
Regulator Covid-19 update for 20 March, including on key worker categorisation
On 20 March: BoE and PRA announced supervisory and prudential prudential policy measures to address the challenges of Covid-19: including: cancellation of the annual stress test for 2020 pausing until further notice the...
CMA varies Santander directions
CMA has varied the Directions to Santander in respect of its Open Banking Release. It had previously varied the directions in January 2019 and considers Santander’s continued failure to comply with the...
FMLC responds on crypto taxonomy
FMLC has responded to the European Commission’s consultation on classification of crypto assets. The detailed response notes: the current parallel classification of cryptoassets in the UK on the one hand and the...
JMLSG consults on crypto guidance
JMLSG is consulting on a new part to its sectoral guidance, to cover cryptoasset exchange providers and custodian wallet providers. The new Part 22: defines crypto-assets, noting some examples which firms should...
PIFMA concerned about Open Finance
PIFMA has responded to FCA’s call for input on open finance. While it applauds FCA’s stance on encouraging innovation, and feels the financial services sector has lagged behind other sectors in adopting...
Gambling Commission fines for AML failings
The Gambling Commission has fined Betway £11,6m for a series of “social responsibility” and money laundering failings linked to 7 VIP customers. The Gambling Commission found that: generally, because the...
EU writes to Chancellor on equivalence
Valdis Dombrovskis has written to Rishi Sunak on equivalence assessments. The letter merely notes that both sides should start to assess equivalence as soon as possible, on the basis of the Political Declaration, with a...
FOS looks at insurance coverage
FOS’s latest Ombudsman News looks at: coronavirus: so far, FOS has not seen many complaints on the impact of the virus, but expects it will see more complaints particularly in relation to travel insurance, medical...
Treasury Committee responds on IT failure and economic crime reports
The Treasury Committee has commented on the responses from Government and regulators on: its October report on failures in the IT industry. The report had concluded, among other things, that: regulators need to improve...
TI welcomes economic crime levy
Transparency International has welcomed the Government’s announcement of an economic crime levy on firms subject to the MLRs. The Government will consult on its plans later in the spring.
Treasury feeds back on pre-paid funeral plans
Treasury has published the outcome of its consultation on pre-paid funeral plans. Respondents to its consultation were concerned at current consumer detriment, and called for compulsory regulation for the sector. The...
Treasury publishes outcome of regulatory framework review
Treasury has published the outcome of the consultation on the financial services future regulatory framework. The Government’s view is that the institutional architecture for regulation remains appropriate and is...
Treasury consults on UK/Gibraltar FS access
Treasury is consulting on the post-Brexit market access arrangements between the UK and Gibraltar. Constitutionally, Gibraltar is an Overseas Territory with internal self-government. Responsibility for financial...
Treasury Committee calls for better carbon footprint awareness
The Treasury Committee, as part of its inquiry on decarbonisation and green finance, is concerned that consumers need better help to understand the carbon footprint of financial products and has written to BoE and FCA...
FCA publishes mortgage switching research
FCA has released its latest report on mortgage switching, from which it concludes there is a case for intervening to help customers who do not switch. It has found that the reasons people have for not switching...
FCA compares bank fraud controls
FCA has published data on the fraud controls banks have in place, intended to help consumers compare what different banks do. UK Finance asked banks: what their approach to fraud prevention was; what controls the firm...
FCA calls for evidence on wholesale market data
FCA has launched a call for input on access and use of data and advanced analytics in the wholesale markets. It wants to understand the value to market participants and whether the information is being competitively...