Emma RadmoreIn the case of Promontoria (Henrico) Ltd v Jeavons and another [2019], the defendants ran a holiday let business in Cornwall. Clydesdale Bank issued them with a tailored business loan, which they then assigned to the...
Category - Consumer Finance
Caroline Stevenson
Scott NodderUK Finance responds to IT failures in the financial services sector
UK Finance has responded to the Treasury Committee’s report into IT failures in the financial services sector. The Treasury Committee criticised the unacceptably high level of failures and called on regulators to...
Rachael Preston
Mortgages (Responsible Lending) Instrument 2019
Following consultation CP19/14, the FCA published the Mortgages (Responsible Lending) Instrument (together with feedback to the consultation) 28 October 2019. The final rules (which come into force immediately) set out...
EBA recommends enhanced online disclosure requirements
The EBA has issued an Opinion directed to the EC, setting out recommendations to revise the scope and consistency of disclosure requirements in EU law to take account of the increasing use of digital marketing channels...
Roseyna JahangirFCA outlines five steps to drive the future of regulation
Christopher Woolard, Executive Director of Strategy and Competition at the FCA, recently spoke about the FCA’s thoughts on how it approaches the future of regulation. He commented that the FCA will be issuing an...
ESMA to examine reporting issues in annual financial reports
ESMA has set out the matters it will prioritise when looking at the 2019 annual financial reports of listed companies. Among the specific areas of focus, ESMA has underlined the importance of the inclusion of...
Goods Mortgages Bill starts passage through Parliament
The long awaited Goods Mortgages Bill has completed its first reading in the House of Lords. In its consultation on the draft bill, HM Treasury described it as: providing increased protection for consumers who use goods...
FCA Guidance on new credit broking exemption for registered social landlords
The FCA has updated FG18/6, which provides specific guidance for registered social landlords on when they may be carrying on regulated activities, to reflect the amendment introduced earlier this year to the Financial...
FCA publishes feedback statement on climate change disclosures
The FCA has published its proposals for its future work on climate change and green finance, following responses to its Discussion Paper in 2018 . In its work, the FCA will be focusing on three outcomes: Issuers provide...
FCA updates change in control pages
FCA has updated its guidance on how to submit an application for change in control. The page now includes useful tips on what FCA needs to know to deal with the application quickly, and links to all the required forms.
FCA provides Brexit preparations update for firms
The FCA has published an update on the steps firms will be expected to take in the event that there is a hard Brexit. In particular, the FCA reminds EEA passporting firms of the need to notify the FCA by 30 October if...
Queen’s Speech suggests post-Brexit FS Bill
Among the list of legislative proposals referred to in the Queen’s Speech is laws that will provide “certainty, stability and new opportunities” for the financial services sector through a Financial...
Government responds on regulatory perimeter
The Government has published its response to the Treasury Committee’s report on the regulatory perimeter and how it could be refined and should be policed. The report had criticised the lack of a formal system for...
European Banking Authority publishes Communication on preparation for Brexit
The European Banking Authority (EBA) has published a Communication on the remaining issues for financial institutions ahead of the UK’s departure from the EU. In its Communication the EBA urges continued progress...
Government publishes No-Deal Readiness Report
The Government has published its “No-Deal Readiness Report” detailing the UK’s preparedness ahead of Brexit on 31 October. The Report contains a section on financial services which, amongst other...
Up next from FCA
FCA’s latest Policy Development Update heralds the following publications before the end of the year: consultation on investment platforms market study remedies; policy statement on OPBAS fees; consultation on...
Changes to Mortgage Reporting Requirements
The FCA published policy statement PS19/23 (PRA – PS22/19) on 30 September 2019. The rules set out the new reporting requirements for regulated mortgage lenders and home finance administrators. The rule changes...
Guidance on unfair consumer terms Directive
The European Commission (the “Commission”) has issued guidance on the interpretation and application of Council Directive 93/13/EEC on unfair terms in consumer contracts (“UCTD”) The Commission...
Estimated £3.4m redress due to unclear interest term in mortgage agreement
The FCA has published an undertaking from the Co-operative Bank (t/a Platform), relating to a term in its mortgage agreement, and agreeing to amend the term on the grounds that it contravened the transparency...
Responsible Lending Changes Implementation Group
The latest meeting of the responsible lending changes implementation group was held on 29 August 2019. This group discussed the feedback they had received to the consultation launched in March (on facilitating...
No more ink? Law Commission confirms validity of electronic signatures
A Law Commission report confirms that electronic signatures can be used to execute documents as an alternative to wet ink signatures in most circumstances. There are some important exceptions and the report only relates...
Suzanne GadoFCA updates on consultations and feedback
The latest Policy Development Update highlights a number of papers due before the end of 2019: feedback on the investment platforms market study remedies; policy proposals on regulatory fees and levies; permitted links...
FCA publishes quarterly consultation
FCA’s latest quarterly consultation covers a number of minor changes to the rules that will be made only if there is a no-deal Brexit on 31 October, and also other miscellaneous amendments including: minor...
EC calls for action with publication of no-deal Brexit checklist
The EC is urging EU businesses and citizens to consider whether they are prepared for the UK leaving the UK on ‘no-deal’ terms on 31 October, reminding them in this scenario there will be no transition...
FCA create implementation group for mortgage changes
Following publication of CP19/14 (the consultation looking at proposed changes to responsible lending rules for mortgage customers), the FCA announced on 27th August 2019 that they have set up an Implementation Group in...
CMA takes action over PPI reminder failures
CMA has ordered RBS and Santander to take remedial action after they did not send, or sent inaccurate annual PPI reminders to customers. The banks must now appoint independent bodies to audit their PPI processes and put...
Consultation on restricting use of credit cards for gambling
The Gambling Commission is consulting on whether to prohibit or restrict the use of credit cards for online gambling. The basis for this proposal lies in evidence they have received suggesting there are risks of...
FCA updates skilled persons statistics
FCA has released the figures for skilled persons reports it commissioned in Q1 2019/20. It commissioned 9 reports in total – of which 3 related to each of retail lending and wholesale financial markets, 2 to...
Up next from FCA
The latest version of FCA’s Policy Development Update highlights: expected feedback on Investment Platforms Market Study Remedies by the end of the year; potential policy statement on general insurance value...
Treasury Committee calls for FCA powers on perimeter changes
The Treasury Committee has unanimously called for FCA to be given formal powers to recommend changes to the regulatory perimeter. It says the current informal system allows the grey area between regulated and non...
BoE publish the RTGS and CHAPS Annual Report
The Annual Report published on 1 August 2019 sets out the BoE’s strategy on the subjects of RTGS and CHAPS for the year 2019/20. The report notes that they have a target of 99.95% operational availability for RTGS...
FOS has updated its consumer credit resources
The updates published on 1st August 2019 relate to unaffordable lending and guarantor loans. The resources provide details of the types of complaints the FOS tend to deal with and include details about how they assess...
Publication of AG Opinion on consequence of removing unfair terms in consumer contracts
The European Court of Justice has published the AG’s Opinion in a case concerning the effect of a declaration of unfair terms for the purposes of the Unfair Contract Terms Directive (in UK law as the Consumer...
EC sets out position statement on equivalence decisions
The EC has published a communication about equivalence decisions (the timing of which is no doubt entirely unrelated to the ascension of pro-Brexit Boris Johnson to the Prime Ministership of the UK). The communication...
FCA publishes SMCR final rules
FCA has at last published its final rules on extending the SMCR to solo-regulated firms, including CMCs. It has, in the main, implemented the changes it consulted on in its consultation on “optimising” the...
Commission adopts unfair terms guidance
The European Commission has adopted a guidance note on the Unfair Contract Terms Directive. The note covers: the objectives and scope of the directive; key terminology such as “supplier” and...
FCA publishes feedback statement on fair pricing
In the context of ongoing work by both the FCA and CMA on fair pricing and loyalty penalties, the FCA has published a feedback statement setting out a framework for how it will evaluate the fairness of a given pricing...
FCA discusses AI in financial services
In a recent speech, Christopher Woolard of the FCA considered three lenses through which the FCA views the issues relating to AI: what are new, and what are existing issues; how to ensure that AI creates value for...
FCA invites feedback on Gabriel replacement
The FCA has announced that it is planning a replacement for Gabriel, its data collection system. It has therefore asked current Gabriel users to complete a feedback survey to provide views that can be considered in the...
The Government responds to the Treasury Committee Report on Consumers’ Access to Financial Services
The Government’s response to the Treasury Committee report was published on 11th July. The document sets out the Government’s response to each of the report’s conclusions and recommendations. The key...
ESA evaluates cross-border supervision of retail financial services
A report published by the Joint Committee of European Supervisory Authorities, ie the EBA, ESMA and EIOPA, has reviewed the current landscape of cross-border supervision, in particular in the light of the regulatory...
BEIS review of Consumer Contracts (Information, Cancellation and Additional Charges) Regulations
The Department of Business, Energy and Industrial Strategy has completed its 5 year review of the Consumer Contracts Regulations. While these regulations broadly exclude financial services, they may be engaged where...
CMA launches digital advertising market study
The CMA has launched a study into online platforms and digital advertising. The study will focus on harm caused by consumers in connection with three areas of digital advertising: the extent online platforms (such as...
Alex LouchTreasury creates RAO exemption for social landlords
A new exclusion from the regulated activity of credit broking will cover registered social landlords who introduce individuals to credit unions, community benefit societies, community interest companies limited by...
UK financial regulators publish climate change Joint Declaration
The FCA, PRA, TPR and FRC have jointly issued a declaration reiterating their commitment to work on the enhancement of climate-related disclosures. The Joint Declaration also welcomes the UK’s Green Finance...
FCA launch Credit Information Market Study
The FCA has published the Terms of Reference for its credit information market study. Whilst the FCA is not formally consulting on the Terms of Reference they are welcoming any comments by the end of July. The market...
FCA summarises new rules
FCA’s latest Handbook Notice confirms the following rule changes: the changes to, mainly MIPRU, MCOB and SUP that took effect on 4 June in relation to crowdfunding platforms that offer home finance products, where...
EU Council adopts crowdfunding position
The Council of the EU has adopted a position it hopes will make it easier for crowdfunding platforms to provide services across the EU, by setting minimum requirements that the platforms must meet and harmonising...
FCA launches credit information market study
FCA has announced a market study looking at how the credit information market operates and its impact on consumers, and has published terms of reference. Christopher Woolard said FCA is concerned abou the coverage and...
“Not all about Brexit” says Philip Hammond
Philip Hammond, speaking at the Mansion House dinner, highlighted the many ways in which a no-deal Brexit would be damaging for the financial services industry and the UK as a whole. He noted also the political...
Treasury announces ‘Breathing Space’ for problem debts
HM Treasury has announced a new scheme to support those in problem debt, including those with mental health issues. The new scheme will introduce a new 60 day ‘Breathing Space period’ during which interest...
CMA may be given enhanced powers to impose fines for consumer law breaches
The government has announced that it will consult on whether the CMA should be given the power to fine businesses directly if they have breached consumer law, for example through the ‘loyalty penalty’ and...
FCA publishes first perimeter report
FCA has published the first of what will be an annual report on its regulatory perimeter. Among other things, the report is designed to explain what challenges the perimeter is presenting and whether there might be a...
CMA updates on loyalty penalty work
CMA has updated on its work on the loyalty penalty. It says key decisions are due shortly and that two enforcement cases are underway. It says it expects regulators to take strong action where they find problems and...
FCA consults on financial resources
FCA is consulting on the approach it takes to assessing adequate financial resources – and what it means by the term. The paper has been prompted by the levels of compensation FSCS has paid out relating to firms...
FCA announces BNPL rules
FCA has announced new rules for the Buy Now Pay Later market, taking effect later this year The rules will protect consumers by: banning firms from charging backdated interest on amounts of money that have been repaid...
Up next from FCA
FCA’s latest Policy Development Update heralds a few interesting papers on the near horizon, including: a consultation in June on alternatives to high cost credit; perhaps, a policy statement on general insurance...
FCA publishes overdraft cost reform rules
FCA has confirmed its final reforms to fix what it describes as a “dysfunctional” overdraft market. Andrew Bailey said he expects the reforms to mean the typical cost of borrowing £100 on an unarranged...
Treasury Committee announces inquiry into decarbonisation of the UK Economy and Green Finance
The Treasury Committee has announced an inquiry that will look at the respective roles of HMT, regulators and financial service firms in supporting the government’s climate change commitment. The terms of...
FOS responds to Treasury Committee ‘mortgage prisoners’ concerns
The Treasury Committee continues to pursue its concerns regarding what is being done or can be done for ‘mortgage prisoners’. These are people who took out mortgages when lending rules were less prescriptive...
FCA and Dutch Authority agree on closer partnership
The FCA and the Dutch Authority for the Financial Markets have agreed to work more closely together in order to protect and enhance the integrity of their financial systems. The regulators will share information to...
Angie BamboulisFCA Publish Final Rules on Loan-based and Investment-based Crowdfunding Platforms
On 4th June 2019, the FCA published its feedback to CP18/20 and its final rules on loan-based and investment-based crowdfunding platforms in Policy Statement PS19/14. The changes largely match the proposals within the...
AG Opinion published on early settlement charges under CCD
The Opinion of the Attorney General has been published in a case referred by the Polish courts to the ECJ on the interpretation of article 16 of the CCD. The question regarded whether the calculation of the reduction...
FCA publishes unfair term undertaking
FCA has published an undertaking from Capital Financial Management Limited. It considered two term in the company’s debt management contract gave the firm sole discretion on what it could charge customers who...
FOS Annual Review 2018/2019
The Financial Ombudsman Service (FOS) has published its Annual Review 2018/2019. The Annual Review highlights that FOS has: received more than 388,000 complaints over the past 12 months, which is up 14% on 2017/2018...
FCA publishes research on execution-only mortgage issues
FCA has published research it commissioned to look at the biggest problems execution-only mortgage customers face in disclosure documents, and how it might be addressed. The problems identified are: because of the...
FCA consults on mortgage advice and selling standards
The FCA has published a consultation paper which sets out its proposals for changes to its mortgage advice and selling standards. The purpose of the consultation is to address the issues identified through the...
Mastercard and Visa to lower interchange fees for payments in Europe
The European Commission has announced that Mastercard and Visa have made binding commitments to reduce interchange fees charged for payments in Europe to customers with consumer debit and credit cards issued outside the...
FCA consults on fees
FCA’s consultation on fees and levies for 2019/20. Among key proposals are: an increase of minimum fees and flat fees of 2% for the A, and CC1 and 2 fee blocks; unchanged variable fee rates for consumer credit...
FCA prioritises culture, customers and crime prevention
FCA’s Business Plan for 2019/2020 holds few surprises. It highlights 4 ongoing cross-sector priorities and three additional longer-term priorities. FCA will focus on: culture and governance, not least in SMCR...
Complaint levels fall
FCA’s data for complaints against regulated firms for H2 2018 show that complaints decreased by 5%, with PPI complaints falling by 8% – although PPI still accounted for 40% of all complaints. In part this...
Memorandum of Understanding between the FCA and the ASA published
The FCA has published a Memorandum of Understanding between the FCA and the ASA. The MoU sets out the areas of responsibility for the FCA and ASA in relation to advertising in the financial services industry. It also...
FCA makes new rules
FCA’s latest handbook notice outlines all the rules adopted by FCA in its February and March Board meetings, including some not reported on in other FIN items. It includes a fill its of all the Brexit instruments...
FCA publishes final no-deal Brexit rules
Perhaps in anticipation of what would follow later in the day, FCA published its final instruments and guidance that would apply in the event of a no-deal, no-implementation period Brexit, on the morning of 29 March...
ESMA fines CRAs for conflicts breaches
ESMA has fined 3 CRAs in the Fitch group a total of €5,132,500 for a series of failures to comply with the requirements of the CRA Regulation relating to conflicts of interest. It found that Fitch UK, Fitch France and...
FCA Publishes Mortgages Market Study Final Report
The FCA published its final report on its Mortgages Market Study (MS16/2.3) on 26th March 2019. This marks the conclusion of the study which originally kicked off in December 2016. The study itself has focused on first...
FCA consultation: Responsible Lending for Mortgage Customers
On 26th March 2019, the FCA published a consultation paper (CP19/14) inviting views on their proposed changes to the responsible lending rules and guidance for mortgage customers. Through the consultation and proposed...
FOS letter to Treasury Committee on reasonable adjustments under the Equality Act
On 26th March 2019, the House of Commons Treasury Committee published a letter from Caroline Wayman (FOS Chief Ombudsman and Chief Executive) to Nicky Morgan (Committee Chair) setting out the requirements to make...
FCA extends temporary permissions window
In light of the current short extension to Brexit, FCA has decided to extend the notification window for EEA firms to apply for temporary permissions. The window was due to close on 28 March, but will now close on 11...
FCA Publish Final Report on the Retained Provisions of the CCA
The FCA has published its final report on the retained provisions of the CCA on 25 March 2019. This final report sets out the FCA’s views on whether the repeal of certain CCA provisions would have an adverse...
FCA looks at life beyond Brexit
In a speech on Brexit delivered by Nausicaa Delfas, Executive Director of International, the FCA reminded firms that the deadline for notifications under the temporary permissions regime is 28 March 2019. Firms that...
What the Consumer Credit firms can expect from the FCA
The FCA has published a speech by Jonathan Davidson, Executive Director of Supervision – Retail and Authorisations, in which he sets out what the consumer credit sector can expect from the FCA in terms of regulation. Mr...
Europe reaches political agreement on reforms to EU supervision
The European Parliament and Member States have reached agreement on core elements of the reform of European supervision of financial markets, including strengthening the supervisory framework in the area of anti-money...
CMA’s Loyalty Penalty Working Group terms of reference published
Following work by both the FCA and the CMA, and the ‘loyalty penalty’ super-complaint, the CMA has published the terms of reference of its recently convened Loyalty Penalty Working Group (LPWG). The LPWG...
Debt management sector: second FCA thematic review published
The FCA has published TR19/01, the second set of findings of its review of the debt management sector. The focus of this review was firms that provide debt advice and administer debt management plans, on a for- or a not...
FCA Update on Digital Regulatory Reporting
The FCA has updated its webpage on digital regulatory reporting (DRR) by publishing – a video which explains the concept of DRR and outlines the work carried out by the DRR pilot group; a report which sets out an...
What the Spring Statement brings for regulation
In the Chancellor’s Spring Statement, the Chancellor referred to the need to ensure financial regulation can adapt to a no-deal Brexit and then, longer term, to the UK’s new constitutional position.
FCA finalises guidance on SoRs and responsibilities maps
FCA has published its finalised guidance to help firms prepare their statements of responsibility and responsibilities maps under the SMCR. The guidance addresses the rules as they apply to each category of SMCR firm...
FCA confirms FOS increase
FCA has issued a policy statement confirming the increase in the FOS award limit. From 1 April, the limit that FOS can award against firms will be £350,000. This amount will apply in relation to complaints about...
FCA makes Directory rules
FCA has made its final rules on its “Directory“. The new public register will enable searches on all directors and senior managers, certification staff and other individuals who require qualifications to...
FCA targets high-cost credit firms
FCA has written a “portfolio strategy letter” to firms that provide high-cost lending products such as guarantor loans, high cost short-term credit and unsecured loans for sub-prime customers, home-collected...
FCA reviews credit card fees and charges
The FCA has written to credit card firms to request they review their policies and procedures in relation to fees and charges, to ensure they result in fair consumer outcomes and comply with CONC. The letter follows the...
EU agrees draft directive to enhance consumer protection
The EU has agreed the terms of a draft directive that, if passed, will amend a number of consumer protection directives, including the consumer rights directive (2011/83/EU), to introduce measures such as: harmonised...
FCA introduces rent-to-own price cap
FCA confirmed today that it would be introducing a price cap in the rent-to-own (RTO) market. The regulator said that it wanted to “bring down prices on RTO agreements where the overall costs to consumers are...
FIN. TeamFCA unhappy with motor finance commission models
FCA is likely to propose changes to how commission works in the motor finance sector. It has carried out a review and has found that commonly used models allow brokers discretion to set the interest rate customers pay...
FCA updates rules
FCA has made a number of amendments to various parts of its rulebook, including: amendments to COBS on information relating to pensions savings, taking effect from November 2019 and April 2020; introducing a Devolved...
Up next from FCA
FCA is running behind schedule on some expected publications. Its latest Policy Development Update highlights the following: consultation and discussion on the Investment Platforms Market Study remedies due in March...
BoE and FCA update on Brexit approach
BoE and FCA have updated their respective websites with coordinated information on their approach to a hard Brexit. BoE has published a series of materials setting out its updated plans to its supervisory approach to a...
Court rules that Brexit is not frustrating event for a lease
The High Court has ruled that a European agency cannot terminate the lease of their premises at Canary Wharf on the basis of Brexit being a ‘frustrating event’. Our article provides more detail on this case...
EU Customers to get currency conversion transparency and cheaper transfer costs
The Commission has published a fact sheet on legislative changes that will give customers from non-Euro Member States access to cheaper intra-EU euro payments. The new Cross-Border Payments Regulation, that will take...
European Parliament votes to abolish high costs for cross border payments within EU
The European Parliament has approved new rules to prohibit high charges on cross-currency payments within the EU. The new rules will mean that charges for cross-border payments in the single euro payments area (SEPA)...
Financial Stability Board 2019 work programme published
The Financial Stability Board has published its work programme for the forthcoming year. The areas upon which it intends to focus are: addressing emerging vulnerabilities in the financial system; working with standard...
ESMA creates Brexit page
ESMA has created a new web-page on Brexit, setting out how it is preparing for it. Its latest agreement is a MoU with BoE for recognition of CCPs and the Central Securities Depository. It aims to recognise all UK CCPs...