Tag Archives: FCA
FCA has now finalised its guidance on insider dealing and market manipulation within the Financial Crime Guide. It received 8 responses to its consultation, generally positive. However, some respondents raised concerns about: mandating a duty to prevent these crimes; the risk of firms tipping off by taking some of the actions the guidance proposed; where […]
PRA and FCA are consulting on new reporting requirements for mortgage lenders and home finance administrators. Both regulators think there are areas in which they need data from firms additional to that which is currently being reported. The changes will affect the MLAR and PSD returns. Key proposals include that: mortgage administrators should submit PSD […]
FCA has published the latest figures on engagement of consumers with its PPI helpline.
The CMA has announced a range of reforms to the investment consultancy and fiduciary management sector after finding competition problems. This follows an extensive market investigation into the sector which started last year, at the request of the Financial Conduct Authority (FCA). The CMA’s final report sets out a number of changes to deal with its […]
FCA has updated its website to show the forms that now apply to insurers, who have become subject to the SMCR from 10 December.
FCA has published the results of its study of cyber-resilience and security in 20 asset management and wholesale banking firms. Its review comprised firms of varying size, scale, operating models and geography. The review comes with many caveats, but the key messages include: Boards and Management Committees still have limited familiarity with the specific cyber-risks […]
FCA’s latest quarterly consultation proposes rules that: amend SUP 16 to address FCA’s concern that it does not always hold accurate “firm details” by requiring an annual accuracy check and removing the option some firms currently benefit from to update details other than using Connect; and add the Association of Accounting Technicians to the list of bodies […]
FCA is consulting on permanent rules to restrict the marketing, distribution and sale of CFDs and CFD-like options to retail consumers. The proposals are similar to the ESMA temporary measures, but FCA wants also to cover closely substitutable products and are proposing some different leverage limits. FCA feels the action is necessary because of constant […]
The FCA has published the outcome of its thematic review into the treatment of customers with long-term mortgage arrears. While in general it found that firms treated such customers appropriately, it did note areas for improvement and inconsistencies in management practices. The FCA recommends that firms that offer or administer mortgages should read the review, […]
FCA has published a decision notice setting out its proposal to find Mohammad Prodhan, the former CEO of Sonali Bank (UK) Ltd £76,400 in relation to the bank’s AML systems and controls. Mr Prodhan was responsible for the establishment and maintenance of effective AML systems and controls and FCA considered that between 2012 and 2014 […]
FCA has published the results of its survey on tech and cyber resilience, which showed that nearly half of all firms don’t upgrade or retire old IT systems in time, and only just over half say they can measure the effectiveness of their information asset controls. Megan Butler, speaking about the report, said that FCA […]
FCA has published a new modification by consent to allow firms to exclude from their complaints return form those PPI complaints in relation to which the complainant had not in fact bought PPI from the firm. Any firm wanting to take advantage of the waiver must email FCA to apply for it.
FCA announced today that it will be delaying the launch of its Credit Information Market Study Terms of Reference until June 2019. The delay is a result of the FCA having to prioritise the market study on general insurance pricing, which launched on 31 October 2018 but was not originally part of its business plan.
FCA has published additional proposals on how it will deal with a hard Brexit. The consultation focuses on: more changes to the Temporary Permissions regime; reflecting the new Credit Rating Agency and Trade Repository Regime in the Handbook and FCA’s approach to guidance and forms Key elements of the consultation include: new “cross-cutting” issues that […]
Rob Gruppetta has spoken on FCA’s views on the use of innovation, data and algorithms to help it in its supervision of, and approach to, financial crime prevention. He said that FCA is always open to innovation, but that it should not be approached without scrutiny. He highlighted FCA’s TechSprints (or “hackathons”), one of which […]
FCA has published a report looking at how banks and building societies are developing and delivering their commitment to provide prompts to customers. The prompts should increase engagement of consumers with their products and make them aware of switching possibilities and developments in retail banking. The report has identified practices that are helpful, such as […]
The FCA has published a speech by Christopher Woolard, Executive Director of Strategy and Competition at the FCA, delivered at the Regulation of Cryptocurrencies event on 20 November 2018. The speech highlights the key issues identified by the Cryptoassets Taskforce (consisting of the FCA, HM Treasury and the Bank of England) in its report published at the […]
FCA is consulting on policy proposals for its proposed regulatory fees and levies for 2019/2020. Among the proposed changes is a plan to streamline the process of setting consumer credit fees by exemption community finance organisations and credit unions. The other main element of the paper discusses how FCA will raise fees from credit rating agencies […]
At its latest Board meeting, FCA has made changes to DISP and its guidance, effective from 8 November, to confirm that firms must not reject relevant regular premium PPI complaints without considering whether recurring non-disclosure is an issue. Separately, FCA has amended Chapter 13 of IPRU(INV) to require personal investment firms to have PII cover […]
Andrew Bailey has written to Nicky Morgan setting out FCA’s plans for improving accessibility and usability of the Financial Services Register, and updating on its recent consultation on the register of individuals.
FCA has published its review of how firms implement FCA whistleblowing rules. Its review covered a range of wholesale and retail banks. It found several areas of both good and poor practice to comment on, and now urges all firms to review the report and consider what steps they may need to take to improve […]
FCA has completed its first financial crime survey. It intends to carry out the survey annually, using the Financial Crime Return. Over 2,000 firms were required to file the return, and FCA looked to establish: the number of customers that pose a higher risk of financial crime: Firms identified 120,000 PEPs and 11,000 non-EEA correspondent […]
FCA has outlined how its temporary permissions Brexit regime will work for inbound EEA firms and funds. FCA carried out a survey earlier in the year for affected firms and funds, and urges relevant firms to complete it if they have not yet done so. The new webpage sets out which firms and fund can […]
BoE, Treasury and FCA have hosted what has now become a regular one day exercise to test the financial sector’s resilience to a major cyber incident impacting the UK.
Following its consultation in July 2018 on handling complaints about regular premium PPI, the FCA has published finalised guidance that confirms that firms should assess PPI commission disclosures not only at point of sale, but on an on-going basis. The FCA is also consulting on new rules that would require firms that sold relevant products […]
FCA’s latest Policy Development Update lists a number of publications due before the end of the year: policy statement on regulating CMCs policy statement on RTS and guidelines under PSD2 rates proposals for covering the costs of OPBAS review of permitted links for insurers in relation to Patient Capital and a discussion paper on Patient […]
On 30 October 2018 the FCA announced that it had fined Liberty Mutual Insurance Europe SE (Liberty) £5,280,800. The fine relates to failures in Liberty’s oversight of claims and complaints relating to mobile phone insurance for the period 5 July 2010 until 7 June 2015. According to the Final Notice issued by the FCA, Liberty had entered into […]
On 31 October 2018, the FCA published the results of a thematic review on the pricing practices of household insurance firms. The review uncovered a number of issues on pricing practices. As a consequence, the FCA announced a number of next steps: conducting a market study on general insurance pricing practices; Publishing a discussion paper […]
FCA’s latest Handbook Notice heralds just one set of rule changes. The changes are to COBS, PERG and examination standards in respect of pension advisers providing suitable advice to consumers about whether to transfer from safeguarded benefits to flexible benefits.
The Cryptoassets task force, led by Treasury, has published its report on the UK’s policy and regulatory approach to cryptoassets. The report looks at the policy and regulatory implications of DLT and cryptoassets and comments on the considerable risks as well as the potential benefits. Now the Task force will consult on a number of initiatives, specifically: […]
The FCA and the Pensions Regulator have published a joint strategy outlining how they will work together to address changes in the pensions and retirement income sector. The joint strategy sets out four areas of focus: access and participation, funding and investments, governance and administration, and consumer understanding and decision-making. The Regulators have prioritised the […]
On 24 October, the FCA published a report on the progress of its consumer communications campaign and supervisory work regarding the 29 August 2019 deadline for PPI complaints. The report looks at: The PPI campaign so far and how consumers are responding to it; The FCA’s supervisory work to ensure firms are helpful and accessible […]
As part of its Brexit preparations, the FCA has updated its webpage for incoming trade repositories that wish to ensure they can continue to do business in the UK following Brexit. Firms are now able to complete draft application forms for registration as a trade repository. The FCA has also published guidance notes for this […]
FCA has today published Evaluation Paper 18/2 on the impact of bringing additional benchmarks into the regulatory and supervisory regime. The paper is the second of a new series of FCA evaluations on its past interventions. Background Misconduct and benchmark manipulation cases and FSA investigations led the Government to ask Martin Wheatley to establish an […]
FCA is calling for the next round of applications for the regulatory sandbox. The deadline for applications to join cohort 5 is 30 October 2018.
PIFMA is concerned that the proposed extension of the upper limits of compensation FOS can order firms to pay out, from £150, 000 to £350,000 could put some small firms out of the market as they will be unable to get affordable PII cover. From 1 April, 2019, FCA is proposing to increase the limits […]
The FCA has published a feedback statement on digital regulatory reporting. This follows the FCA’s call for input on smarter regulatory reporting in February 2018. The FCA found that most respondents agreed that there are significant potential benefits to be gained by introducing digital regulatory reporting, with the most commonly cited benefit being increased efficiency. However, […]
The FCA has published a consultation on proposed guidance to help solo-regulated firms draft their Statements of Responsibilities (SoR) and (for enhanced firms) Responsibilities Maps, in preparation for the SMCR extension in December 2019. Although targeted at solo-regulated firms, the FCA notes that the guidance may also be useful for dual-regulated firms preparing or updating […]
As heralded at the end of last year, the FCA has now published two consultation papers that make provision for operations in the event of a ‘hard’ Brexit next March. The first consultation sets out changes to the FCA’s Handbook and to those EU Binding Technical Standards, which, it is proposed, would be incorporated directly […]
FCA has published feedback and final rules and guidance following its consultation on improving the quality of pension transfer advice. Since the introduction of “pension freedoms” in 2015 members have had more options available to them in terms of accessing their defined contribution (DC) pension savings. This has resulted in a substantial increase in the number of […]
The FCA and Securities and Futures Commission (SFC) have signed a Memorandum of Understanding (MoU) on Mutual Recognition of Funds, which will allow eligible Hong Kong public funds and UK retail funds to be distributed in each other’s market through a streamlined process. The MoU also establishes a framework for exchange of information, regular dialogue, and regulatory cooperation […]
The FCA is consulting on the introduction of rules to address issues that could arise where open-ended funds with illiquid asset holdings encounter stressed conditions. Following the outcome of the Brexit referendum in June 2016, a number of such funds had to cease trading for a period of time, following a rush by investors to […]
Following the FCA’s Call for Input into the implementation of the PRIIPs Regulation, the Personal Investment Management and Financial Advice Association (PIMFA) has commented that it agrees with concerns about the practical operation and the detailed KID requirements of the regime. In particular, PIMFA has noted that there is a suggestion that UCITS and other […]
Treasury has set out its plans for a temporary transitional tool for the UK regulators to use that will enable them to phase in the requirements for UK firms that will change under the raft of onshoring legislation consequent on Brexit. The EU Withdrawal Act provides the enabling powers for Treasury to make the various […]
FCA has published its Thematic Review into money laundering and terrorist financing risks in the E-money sector. Its review covered 13 firms and focused on e-money products including prepaid cards and digital wallets, but not money remittance services or any services that fall outside FCA’s regulatory remit (such as exempt cards). FCA found the firms […]
Charles Randell, speaking at AFME’s conference, highlighted the damage that a cycle of deregulation, crisis and regulation can do. He discussed in particular the risks of deregulation, or the choice not to apply regulation to something innovative, thus encouraging business into that area – which often then leads to a scandal and then the introduction […]
Christopher Woolard has spoken on how FCA recognises the value of testing interventions so that regulation works most effectively. He highlighted how what may seem well intentioned and well designed interventions may in fact fail and how FCA has made significant use of behavioural economics to assess what works best. He gave an example of […]
FCA has made three new rules instruments at its September board meetings: the Individual Accountability (Dual-Regulated Firms) Instrument 2018: this instrument makes significant changes to SYSC as well as to COCON, COND, APER FIT and SUP, and several other changes to many other handbook modules and guides. The changes mainly take effect on 10 December […]
The PRA has published a report examining the impact of climate change on banks in terms of financial risk implications. The report notes that 70% of banks recognise that climate change poses financial risks to their business model, for example, and immediately, exposures to mortgaged homes at risk of flooding or by investments in countries […]
FCA’s latest Market Watch focuses on market conduct and transaction reporting issues. It follows up on previous editions, which looked at FCA’s conclusions from a series of supervisory visits on suspicious transaction reporting. FCA had been concerned about over-reliance on “out of the box” alert calibration and that surveillance was not very developed for some asset […]
The FCA has opened a consultation that sets out how it will apply the Senior Managers and Certification Regime (SM&CR) to Claims Management Companies (CMCs), following taking over regulation of them from 1 April 2019. The consultation also sets out when SM&CR may apply to CMCs, and what action they will need to take. The […]
As part of its implementation of PSD2, the FCA has published a consultation on matters relating to the Regulatory Technical Standards for strong customer authentication and common and secure open standards of communication (SCA-RTS) (CP18/25). Most of the SCA-RTS provisions come into effect from 14 September 2019, and certain provisions relate to measures that regulators […]
FCA has confirmed it has closed its remaining investigations into life insurers, following its thematic review into the fair treatment of longstanding customers in the life insurance sector. FCA has already closed investigations into some of the firms within its study and has now concluded no further action is needed in respect of the last […]
The FCA and PRA have published a joint ‘Dear CEO’ letter sent to major banks and insurers supervised in the UK regarding the preparations and actions they have taken to manage the transition from the London Interbank Offered Rate (LIBOR) to alternative risk-free rates (RFRs). The purpose of the letters is to seek assurance that firms’ senior […]
Michael Nascimento, the controlling mind of a £2.8m investment fraud was sentenced to 11 years’ imprisonment in the Southwark Crown Court. Between July 2010 and April 2014, members of the public were cold-called and subjected to high pressure sales tactics to persuade them to purchase shares in a company that owned land on the island of Madeira. […]
The FCA has held its annual public meeting, at which it reviews the year past, talks about key priorities for the year ahead and takes questions from the public. Charles Randell, who was chairing his first Annual Public Meeting, opened the meeting by: noting that the demands of Brexit preparation meant that they were forced […]
FCA’s latest quarterly consultation focuses on SUP. FCA proposes changes that will update the Gabriel validation rule and FCA guidance on the capital adequacy form for APIs, and update its supervisory principles in line with its Approach document. Consultation closes on 7 November and 7 October respectively.
FCA and the Chartered Insurance Institute have worked together to create a re-assessment test of the level 4 diploma in financial planning. The new “Regulated Retail Investment Adviser Re-Evaluation” will be available from October. FCA encourages firms to use the test and may ask them to use it as part of its supervisory activities if […]
FCA has appointed Sheldon Mills, currently senior director of mergers and state aid at the CMA, as its new director of competition. He will take up the role in November.
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 […]
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, […]
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 […]
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 […]
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 […]
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 […]
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 […]
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 […]
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 […]
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. […]
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 […]
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 is consulting on rule changes for loan-based crowdfunding platforms, following its post-implementation review. It has noted the market has developed, and models have become increasingly complex, since FCA’s last review of the sector. It has also noticed some poor practices developing. Now it wants to make changes to ensure: investors get clear and accurate […]
The FCA has updated FG 16/5, ‘Guidance for firms outsourcing to the ‘cloud’ and other third party IT services’. This update takes account of the publication of the European Banking Authority’s recommendations, and changes to relevant legislation.
FCA’s latest Handbook Notice confirms several rule amendments, including: changes to DEPP and EG to explain the status of industry codes of conduct that FCA has formally recognised; changes to several parts of the Handbook including SYSC and COBS in respect of the IDD, to ensure professional firms regulated by FCA meet similar requirements to […]
FCA has opened a Call for Input to get firms’ and consumers’ initial experiences of the PRIIPs requirements. It welcomes comments generally, but particularly in respect of: determining whether a product is within or out of scope; and the practical aspects of cost and risk disclosure requirements. The Call for Input usefully summarises the various […]
FCA has banned the 4 former directors of a now-dissolved credit broker, Secure My Money Limited. It found the firm misled customers into thinking they had been approved for short term loans and as a result took fees of over £7.2m from around 124,000 online customers. The failings happened over an 8 month period. Customers […]
On a new page on its website, ‘Measuring our impact before we intervene‘, the FCA has published a group of documents that aim to provide an indication of how the FCA assesses the likely impact of its policies. These documents consist of: a paper setting out the FCA’s approach to conducting cost benefit analyses for […]
The Complaints Commissioner has published its annual report on complaints against FCA and FCA has responded. FCA notes that the Commissioner upheld FCA’s decision in 90% of the cases reviewed and generally feels FCA deals with the large majority of complaints fairly. It also takes on board the recommendations as to how it could have […]
FCA has published its annual report on enforcement actions. In 2017/18 it issued 269 final notices (of which only 21 were against individuals), secured 303 regulatory/civil outcomes (mainly involving refusal, variation or cancellation of permission or authorisation) and 14 criminal, and imposed 16 financial penalties which totalled nearly £70m. This contrasts to the £884m of fines 2 […]
FCA has published its Annual Report and Accounts for 2017/18. The report includes details of: FCA’s work preparing for Brexit; key regulatory changes such as MiFID 2 and PSD 2; work on SMCR extension; thematic work on high cost credit and consumer debt; and the PPI customer information campaign. It also articulates what FCA has done […]
Nausicaa Delfas has spoken on the FCA’s approach to Brexit. She looked at how it is preparing and forward to the future. She stressed that FCA is working hard with the Government and other regulators to ensure the smoothest transition possible and promised highly integrated markets in the future regardless of the Brexit outcome. FCA […]
FCA has published the interim findings of its market study on competition in the investment platform market. It has concluded that competition is working well for most consumers, but has identified a few areas that need attention to help consumers. It found: barriers to switching are significant and therefore the pressure on platforms to continue […]
The FCA has launched a consultation on a package of measures designed to protect consumers, improve engagement and promote competition in the retirement income market. Alongside the consultation, the FCA has published the final report of its Retirement Outcomes Review, an investigation into how the pensions and retirement income sector has been working since the […]
FCA confirms that pension schemes will not need to start clearing OTC derivatives when EMIR exemption expires on 16 August 2018
On 3 July 2018, the European Securities and Markets Authority (ESMA) published a statement on the clearing obligations for pension scheme arrangements under the European Market Infrastructure Regulation (EMIR). EMIR introduced a temporary exemption for certain pension schemes from the obligation to clear their OTC derivative contracts to allow time for a suitable technical solution […]
Charles Randell, the recently appointed Chair of the FCA and the PSR, has delivered a speech, in which he discussed the increasing dominance of algorithms in our day to day lives, and noted some of the consequent issues that will need to be grappled with, as the rise of Big Data, AI and machine learning […]
FCA has published a paper looking at how it should approach fairness in price discrimination in financial services. It notes that price discrimination is not in itself unfair as practices such as student discounts are widely accepted. But others are more controversial, such as where longstanding customers receive a worse deal than new ones. Views […]
On 4 July 2018, the PRA published policy statement (PS)15/18 in response to Consultation Paper (CP) 14/17 ‘Strengthening individual accountability in insurance: extension of the Senior Managers and Certification Regime to insurers’ and CP 28/17 ‘Strengthening accountability: implementing the extension of the SM&CR to insurers and other amendments’. As well as feedback to responses to […]
FCA has published a suite of papers feeding back on the SMCR extension, and has proposed the creation of a new directory of individuals working in financial services to enable their status and history to be checked. The directory would include all individuals who require FCA approval to hold SMFs and those who fall within […]
We recently wrote an article for Compliance Monitor setting out themes from recent FCA thematic reviews.
FCA has made new rules. The changes affect several parts of the Handbook, including: miscellaneous minor and clarificatory changes, including a change to the application chapter of SYSC to clarify that certain rules in SYSC 4.3A do not apply to an AIFM investment firm that is not a CRR firm; changes to make the Handbook consistent […]
The FCA has published a progress report on its ongoing Strategic Review of Retail Banking Business Models. The purpose of the Review is to consider the sources of competitive advantage that may have helped the major banks retain their market share, and from that analysis consider the potential for change and the impact of that […]
The Treasury, the Bank of England and the FCA have published information about how financial services legislation will be on-shored under the EU (Withdrawal) Act, in particular to ensure the (hopefully unlikely) ‘hard Brexit’ scenario is addressed, if the negotiated implementation period is not able to take effect from March 2019. The Treasury intends to lay […]
FCA is consulting on changes to complaints handling rules to help victims of authorised push payment fraud. Currently, victims cannot complain to the PSP that receives their payment when their own PSP is not at fault. FCA now proposes rule changes to require firms to handle this type of complaint, and also to allow eligible […]
FCA has published feedback on its Call for Input on Access to Insurance. Its main concern is that people with pre-existing medical conditions find it hard to get travel insurance. Common themes were: lack of good information about options for consumers who had received a high quote or been refused cover; lack of consumer understanding […]
FCA has written a “Dear CEO” letter on the financial crime risks of crypto-assets. The letter notes the scope for cryptoassets to be used for both criminal purposes and non-criminal purposes that nonetheless present the risk for abuse. The letter sets out what FCA regards as good practice for how banks handle these risks. The letter suggests: that […]