Emma RadmoreFCA has carried out a multi-firm review looking at whether CMCs have been using their FCA-authorised status to legitimise unregulated services. It has found that some firms in the sample actually carried out very little regulated claims activity and have now applied to cancel their permissions. Key concerns include:
- lack of proper systems and controls to differentiate between regulated and unregulated claims activity;
- high levels of fees for unregulated activity – which FCA does not like, although it has no status to require firms to change these; and
- non-compliant financial promotions.
FCA wants firms to be clear in their communications as to which of their products and services are regulated and which are not. And it urges CMCs to keep the spirit of the Consumer Duty in mind in all their work.