FCA has finally published the Dear CEO letter it sent to retail banks on 22 May on AML failings. The letter sets out the common themes FCA has observed and highlights its disappointment that it continues to find certain...
Author - Emma Radmore
Emma Radmore
Damning report on EU AML efforts
The European Court of Auditors has published a damning report on the EU’s efforts to fight money laundering in the banking sector. A review found institutional fragmentation and poor coordination at EU level. The...
FCA to host Business Plan webinar
FCA is to unveil its business plan on 15 July and is holding a webinar at which Nikhil Rathi will set out his view of FCA’s role and answer questions.
FATF holds plenary
FATF has held its June 2021 plenary session, at which it finalised a number of reports. Key outputs include: no changes to the highest risk jurisdictions, but Haiti, Malta, the Philippines and South Sudan have been made...
FCA updates rules
FCA’s latest Handbook notice confirms updates to: TC to improve information sharing on retail advisers’ failure to comply with appropriate FCA rules and to update on accredited qualifications. COMP to...
Premium finance disclosure changes delayed
FCA has published an update to its feedback statement and new rules on general insurance pricing practices, which means that the new rules relating to premium finance disclosure will take effect on 1 January 2022...
BoE and Pay.UK collaborate on payment messages
Pay.UK and BoE have announced a collaboration on ISO 20022 payment messages. ISO 20022 will be implemented in the CHAPS and NPA. The collaboration started in 2018 and BoE and Pay.UK will continue to work together to...
BoE takes action over Euroclear settlement outage
BoE has announced it is taking supervisory action over the operational settlement outage suffered by Euroclear UK and Ireland in September 2020, which caused significant market disruption. The outage was caused by a...
FCA publishes VOP refusal
FCA has published its final notice explaining its reasons for refusing a firm’s application to vary its permission. Gedik International Limited was authorised in February 2020 as an agency brokerage with a set of...
Treasury Committee calls for FCA culture shift
The Treasury Committee has published a unanimously agreed report on FCA’s regulation of London Capital and Finance, in which it expresses the view that FCA cannot justify expecting firms it regulates to comply...
IAIS publishes application papers
IAIS has published application papers on: resolution powers and planning; the paper looks at the objectives and concepts of resolution of insurers, entry into resolution, resolution powers and plans, resolvability...
More of FS Act comes into force
The second Commencement Order under the FS Act 2021 brings into force: on 28 June the provisions on forfeiture of money in relation to EMIs and payment institutions, as they extend to Northern Ireland; and on 1 July...
Treasury responds on Fin Proms
Treasury has published its response following its consultation on a regulatory regime for the approval of financial promotions. It had been concerned about: lack of expertise in approver firms; lack of due diligence by...
FCA speaks on tough regulation and the future
Nikhil Rathi has spoken on building a regulatory environment for the future. He focused on the opportunities Brexit has given for the UK to tailor its rules. Much of his speech addressed ESG issues, but he noted also...
FCA consults on regulated firm climate disclosures
FCA is consulting on enhancing climate-related disclosures by asset managers, life insurers and regulated pension providers. Following on from the introduction of disclosure rules for the most prominent listed companies...
PRA consults on financial holding companies
PRA has issued a further consultation on applying existing prudential consolidation requirements to financial holding companies and mixed financial holding companies approved or designated under FSMA. The proposals:...
LSB updates on CRM code review
LSB has published its follow up review of the CRM Code in respect of firms’ approach to reimbursing customers. Provision R2(1)(c) of the Code allows firms to decline reimbursement in specific cases. LSB looked at...
Government responds on financial exclusion
The Government has published its response to the Lords Liaison Committee report on tackling financial exclusion. Key elements of the response consider: access to cash: the response notes that the FS Act 2021 will allow...
PRA updates on Solvency II QIS
PRA is to launch its Quantitative Information Survey on Solvency II during the summer. The QIS will cover the calculation of the matching adjustment, risk margin and the transitional measure on technical provisions. ...
Taskforce reports on regulatory reform
The Taskforce on Innovation, Growth and Regulatory Reform has provided its report on reshaping regulation in the UK to the Prime Minister. The report calls for: a common law approach proportionality in application...
ECB consults on “fit and proper”
ECB has issued a consultation draft of its requirements when assessing members of management boards and those holding key functions within regulated institutions as “fit and proper”. It asks for comment by ...
Sam Woods reappointed
Sam Woods has been reappointed as Deputy Governor of the BoE with responsibility for Prudential Regulation and Chief Executive of the PRA. His second 5 year term will last until June 2026.
PRA updates on TPR timetable
PRA has updated on authorisations under the TPR. It has reminded that it has up to the end of 2023 to process applications from firms falling under it. Currently, it is seeing a high volume of applications of varying...
Up next from FCA
FCA’s latest Policy Development Update highlights: a policy statement in July on regulation of funeral plans, and consultation on resolution and FSCS protection rules for the funeral plans sector consultations on...
Treasury Committee to hold economic crime hearing
The Treasury Committee will hold its next evidence session in its Economic Crime Inquiry on 14 June. The witnesses will come from the FCA, PSR, HMRC and Companies House.
FCA takes 13 firms into new sandbox cohort
FCA has accepted 13 firms into cohort 7 of the regulatory sandbox. It received 58 applications, mainly from firms in the retail investment and retail lending sectors. FCA was interested in proposals that saw more...
Basel Committee consults on prudential treatment of crypto exposures
The Basel Committee is consulting on preliminary proposals on how to treat banks’ cryptoasset exposures. It notes that exposure is currently limited, but there is the prospect that heightened exposures could...
EBA finalises PSD2 incident reporting guidelines
EBA has finalised and published its revised guidelines for major incident reporting under PSD2. PSD2 requires PSPs to report major operational or security incidents to their supervisors where those incidents are likely...
Law Commission consults on corporate criminal liability
The long-awaited Law Commission consultation on corporate criminal liability was published on 9 June. The Law Commission notes that companies can only be found guilty of offences that require proof of a certain mental...
LSB launches Access to Banking Standard Review
LSB has published a consultation paper on the review of the Access to Banking Standard. The Review is aimed at determining whether the Standard is still an effective way to achieve fair outcomes for customers (consumers...
FS Act 2021 starts to come into force
The first commencement order for the FS Act 2021 bring into force: on 9 June, sections 3-5 and Schedule 3 on prudential regulation of credit institutions by PRA on 26 June, section 7 and part of Schedule 4 on amendments...
FCA consults on CONC and other miscellaneous changes
FCA’s latest quarterly consultation on minor rule changes focuses on: changes to CONC to enable firms that provide credit cards to offer instalment plans without applying for a rule modification make minor changes...
CPS updates on failure to disclose prosecution factors
CPS has updated its guidance on prosecuting “standalone” failure to disclose offences under s330 POCA. It can now (from 2 June) bring a prosecution regardless of whether a predicate money laundering offence...
UK takes over G7 presidency
The International Regulatory Strategy Group has published a paper on the financial services priorities for the UK’s G7 Presidency. The UK took over the Presidency in January and the IRSG now says it should focus...
FCA extends temporary crypto registration regime
FCA has extended the date of the Temporary Registrations Regime for cryptoasset businesses until 31 March 2022. The regime, which allows businesses that were in existence and applied for registration before 16 December...
Treasury extends UCITS PRIIPS exemption
Treasury is to extend the exemption from the requirements of the PRIIPs Regulation for UCITS until 31 December 2026.
EBA and ESMA update on IFR permitted funds
EBA and ESMA have published a provisional list of additional instruments and funds that some of the smallest investment firms may use as own funds under the IFR. The list is designed to help firms in advance of the IFR...
Market Watch looks at use of orderbook data
The latest edition of Market Watch explains how FCA uses orderbook data to help conduct surveillance to identify suspected market manipulation. It uses its own data combined the STORs and other notifications it...
FCA and PRA make new accountability rules for long term absence
FCA and PRA have confirmed their policy on long term absences. FCA has made new rules on individual accountability, requiring firms to notify it when a Senior Manager or Approved Person at an AR takes more than 12...
FCA finalises value pricing and loyalty penalty measures
FCA has finalised its package of remedies that will protect home and motor insurance customers from loyalty penalties and improve competition. The package of rules will: require insurers to offer renewing customers a...
Pensions Dashboard call for input
The Pensions Dashboards Programme has called for input on plans for the staged compulsory connection of pension providers to the new ecosystem. The DWP, FCA and TPR have been involved in developing the proposals, which...
ESMA finalises marketing guidelines
ESMA has clarified its guidelines on standards for fund marketing. Following its consultation, the guidelines detail how all marketing communications should: be identifiable as such; describe the risks and rewards of...
ESMA calls for evidence on digital finance
ESMA has launched a call for evidence which aims to gather information on various issues relating to digital finance. It is particularly seeking to understand: more fragmented or non-integrated value chains, which arise...
FOS publishes Annual Complaints Data
FOS has published its annual complaints data for April 2020 – March 2021. Key highlights include: an overall increase in new complaints of 2% from the previous year – but a 58% increase when PPI complaints...
FCA intervenes on high risk CFDs
FCA has stopped ICC Intercertus, a Cypriot firm operating under the TPR, from conducting any regulated or marketing activities in the UK. The firm’s wider group traded as “EverFX” and used the...
FCA confirms role in RLS
FCA has confirmed its approach to regulating firms in relation to the Government Recovery Loan Scheme that was launched by the British Business Bank on 6 April to replace the BBLs and CBILS which are now closed to new...
PRA speaks on Cyber Risk
Lyndon Nelson has spoken about the steps PRA takes to counter cyber risk. He described how PRA has looked at operational resilience in the context of cyber risk by testing, capabilities and coordination. It has carried...
PRA updates on MRTs
PRA has published an update on the requirements applicable to material risk takers. The EU did not adopt an updated version of the MRT Regulation before the transposition date of CRD V, and so PRA is currently using...
FCA orders firm to terminate AR agreements
FCA has published a first supervisory notice to Marshall Sterling Investment Management Limited, requiring it to terminate its relationships with 2 appointed representative firms within 14 days of the notice, and with a...
No timescale on BNPL
In answer to a question in Parliament, the Government confirmed its intention is still to bring forward secondary legislation to bring forward currently unregulated BNPL products “when Parliamentary time...
PRA publishes results of 2020 feedback survey
PRA has published the results of its 2020 firm feedback survey. The survey asked questions aiming to understand whether firms consider that PRA understands the firm and its business and the it has appropriate access to...
PSR consults on CoP for all
The PSR has issued a call for views on whether it should direct additional banks, building societies and financial institutions to offer Confirmation of Payee. Currently only the 6 biggest banking groups offer it. The...
FCA brings charges for unauthorised activities
FCA has taken criminal proceedings against Ian Hudson for carrying on his business, Richmond Associates, with the intention to defraud creditors and for carrying on the regulated activities of accepting deposits and...
ICO fines Amex for direct marketing messaging without consent
The ICO has fined American Express Services Europe Limited for sending, or instigating the sending of, over 4 million direct marketing messages over the period of a year, for which subscribers had not provided consent. ...
FCA updates on change of legal status applications
FCA has updated its website to state that from 1 June 2021 firms will no longer be able to apply to change their legal status. Instead, they will need to submit a new authorisation application for the new entity and...
Rebranded BSB updates website
The former Banking Standards Board has been rebranded as the Financial Services Culture Board from May 2021. It is now open to all financial services firms operating in the UK
FCA writes to CEOs of EMIs on client money
FCA has written a Dear CEO letter asking e-money firms to write to their customers to explain how their money is protected. It is worried that these firms’ promotions to customers give the impression that their...
IAIS consults on AML guidance
IAIS is consulting on changes to its “application paper” on AML and CFT in the insurance industry. The paper was originally published in 2013, and IAIS has revised it in light of various FATF updates and...
FCA clarifies application of EBA outsourcing guidelines
FCA has updated its webpage on outsourcing and operational resilience to clarify the application of EBA’s guidelines on outsourcing. It has confirmed that it expects relevant firms to continue to comply with them...
SFO publishes business plan
SFO’s business plan for 2021/22 includes nothing of great surprise. Its main priorities remain: investigating and prosecuting the most complex cases of fraud, bribery and corruption; delivering justice, upholding...
Dormant Assets Bill introduced in Lords
The Dormant Assets Bill has been introduced into the House of Lords and has had its first reading. The Bill proposes expansions to the current scheme to include not only bank and building society assets, but also long...
FSCS confirms 2021/22 levy forecast
FSCS has confirmed its levy forecast for 2021/22 at £833m. This is slightly lower than the indicative levy announced in January, partly because extensions of government support are likely to mean some firms will...
FCA reminds that complaints handling should be back to normal
FCA has reminded firms that its guidance on complaints handling during the pandemic expired on 1 May, and firms should now be back to normal.
FCA and PSR make statement on access to cash
A joint statement from FCA and PSR stresses that although there has been an overall decline in use of cash, withdrawals have started again as restrictions ease, and there must remain access to cash and banking services...
Treasury clarifies CIS exemption for P2P operators
Treasury has amended the FSMA (CIS) Order to clarify that the exemption that means operators of peer-to-peer lending platforms are not operating CIS when they carry out activities closely associated with platform...
FCA finalises guidance to insolvency practitioners
FCA has finalised its non-Handbook guidance on how IPs should approach insolvencies of regulated firms. The guidance focuses on how an IP appointed to a regulated firm should ensure the firm meets its ongoing financial...
Up next from FCA
The latest Policy Development Update from FCA heralds: a consultation on a new ESG sourcebook for enhancing climate-related disclosure requirements, coming in June; and a consultation on exit fees in investment...
FCA speaks on UK regulation and FCA transformation
Nikhil Rathi has spoken on FCA’s vision for regulation of the future. His audience was overseas banks, and he focussed on FCA’s priorities in regulating overseas firms at the same standards as domestic...
EBA consults on AML/CTF database
EBA has published for consultation draft RTS on a central AML/CTF database. The idea is for the database to contain details of weaknesses in systems and controls within individual firms identified by their national...
Financial Services Bill – what changed?
Read our article for Compliance Monitor on the key changes from the original Financial Services Bill to the Act given Royal Assent – and some of the proposals that weren’t included.
FCA fines for financial crime failings in cum/ex trading
FCA has imposed its first fine for failings in cum/ex trading, dividend arbitrage and withholding tax reclaim schemes. It fined Sapien Capital £178,000 for systems and controls failings that led to the risk of...
Treasury updates on economic crime plan
Treasury has updated on the Government’s progress on its Economic Crime Plan. It is pleased to see an improved understanding of the threats to the economy and the moves that have been made to address...
PRA reports on collections in non-systemic banks
PRA has published a letter setting out the findings of its thematic review on collections. The letter follows PRA asking the internal audit function within non-systemic UK deposit takers to review their: collection...
FCA publishes H2 2020 complaints data
FCA’s most recent complaints data report shows: a significant drop in complaints over the H1 2020 figure; a large decrease in insurance and pure protection complaints – with the largest being in PPI...
FCA publishes DP on high risk investment promotions
Following feedback to its Call for Input on Consumer Investments, FCA has published a discussion paper on proposals to strengthen its financial promotion rules for high-risk investments. The paper focuses on three main...
FS Bill gets Royal Assent
The final stages of the FS Bill’s passage through Parliament have been completed, with the Lords agreeing on the Commons amendments to the duty of care provisions, and not insisting on following through with the...
FCA consults on changes to UK MiFID firm organisational requirements
FCA is consulting, as part of its wider capital markets reform work, on a set of changes to the conduct and organisational requirements on research and best execution. The aim is that the rules continue to achieve...
Court considers “by way of business” test
The High Court has considered the scope of the “by way of business” test for the purposes of FSMA. Mr and Mrs A were involved in property development. They took a loan from a Mr P when they were unable to...
Debate over FS Bill continues
The House of Commons has not agreed with some of the Lords amendments to the FS Bill. In particular: they reject the addition of the requirement on FCA to make rules on the duty of care to take effect by 6 April 2022...
Government makes Global Anti-Corruption Sanctions Regulations
The Government has made the Global Anti-Corruption Sanctions Regulations 2021 using its powers under SAMLA. The Regulations took effect one hour after being made, at noon on 26 April. They give the Secretary of State...
PRA consults on correcting “higher paid MRT” definition
PRA is consulting on correcting an error in the PRA rulebook which currently means the definition of “higher paid material risk taker” is not aligned with PRA’s approach in SS 2/17. The error happened...
FCA concerned about Provident scheme of arrangement
FCA has published a letter setting out its concerns over Provident SPV Ltd’s proposed scheme of arrangement. FCA attended the hearing at which Provident applied to the High Court for permission to hold meetings of...
HMRC updates on MLR non-compliance
HMRC has issued its periodical update on businesses that it has found to be non-compliant with the MLRs. Its latest report covers the quarter from February 2020 – January 2021. The largest fines have been on MSBs...
OFSI blogs on licensing
OFSI has published a blog on licensing under the sanctions regime, prompted by the changes to the UK sanctions regime post-Brexit. The blog gives an overview of the licensing process, including OFSI’s top tips on...
PRA updates on remuneration reports templates
PRA has updated firms on its approach to the Remuneration Benchmarking and High Earner’s Reporting Templates, part of the EBA Taxonomy. This information became reportable in XBRL format from the end of 2020, with...
FCA takes criminal action for unauthorised mortgage activities
FCA has started criminal proceedings against 2 individuals for unauthorised activities relating to mortgages. Larry Bareto traded as an unauthorised firm and Tassib Hussain is an accountant. Over a 3 year period Mr...
Parliament publishes FS Bill Lords amendments
Parliament has published a full list of amendments made at the Lords Report stage of the Financial Services Bill. These include: requiring FCA to have regard to the principle that firms should not benefit from...
JMLSG consults on changes to Trade Finance guidance
JMLSG is consulting on changes to the trade finance chapter of part 2 of its guidance. The changes update explanations and references and reformat the text on developing a risk-based approach. It asks for comments by...
LSB updates CRM Code
The LSB has published updates to the CRM Code following its review. The new provisions include those on governance and oversight, and will take effect from 14 June 2021.
FCA censures firm and requires compensation payment
FCA has publicly censured a firm that sold extended warranty insurance and ordered it to pay customers compensation of nearly £400,000. It would have imposed a fine of nearly £1m had it not been for the extreme...
FCA delays Business Plan
FCA will publish its 2021/22 Business Plan in July rather than the usual April. The publication will come alongside its accounts and will include detail on its plans for transforming the organisation.
Treasury Committee starts Greensill Capital inquiry
The Treasury Committee has launched an inquiry into lessons that can be learnt from the failure of Greensill Capital. The inquiry is supported by letters to various regulators, including a letter to FCA asking for...
FCA issues second IFPR consultation
FCA has published its promised second consultation on the IFPR. The IFPR creates a new regime for solo-regulated MiFID investment firms. The consultation covers: aspects of own funds requirements not previously...
Nausicaa Delfas to join FOS
FOS has announced that Nausciaa Delfas will take up the post of Interim Chief Executive and Chief Ombudsman from mid-May. Meanwhile, Stephanie Cohen will take up the permanent role of FCA COO in June.
Treasury consults on regulation of mini-bond issuance
Treasury has published an open consultation on bringing the issuance of mini-bonds (or, as the consultation refers to them “non-transferable debt securities) within the scope of regulation, as part of the package...
FCA stops Cypriot firm offering CFDs in UK
FCA has stopped a Cypriot firm that was operating in the UK under the TPR from conducting any regulated activities in the UK and to close all its trading positions and return money to customers. It found the firm, which...
FCA fines and bans unapproved adviser
FCA has banned a financial adviser and fined him £68,300. Simon Varley was a director and held the (then) CF10 function at Dickinsons Financial Management Limited. He was also a CF30 customer adviser until 2013, when...
Regulators warn on deposit aggregators
PRA and FCA have written a Dear CEO letter warning firms of the risks associated with the increasing volumes of deposits placed via deposit aggregators. The letter says the regulators do not want to stifle innovation or...
LSB looks at APP scam prevention
LSB has stressed the importance of preventing APP fraud in the first place, rather than just ensuring customers who suffer can be reimbursed – critical though that is. It notes that the increase in online and...
Up next from FCA
FCA’s most recent Policy Development Update promises, by the end of April, only the rates proposals for 2021/22. The other planned consultation, on exit fees in investment platforms, has no scheduled date and will...