FCA has fined Tesco Personal Finance plc £16,400,000. It found the bank failed to exercise due skill, care and diligence in protecting its PCA holders against a cyber attack that took place in November 2016. As a...
Category - Enforcement & Litigation
Emma RadmoreESMA confirms and updates product intervention on CFDs
ESMA has confirmed the further extension of the restriction on marketing, distributing and selling CFDs to retail clients, for another three months. Alongside the extension it has updated its FAQs, particularly to...
Latest Market Watch focuses on transaction reporting
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...
FCA consults on applying SM&CR to CMCs
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...
FIN. TeamFCA announces life insurance investigation outcome
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...
FCA bans former Deutsche trader
FCA has confirmed its ban on Christian Bittar, formerly interest rate derivative trader at Deutsche Bank. It found Mr Bittar requested EURIBOR submitters to make high or low submissions, both internally and externally...
Ringleader sentenced in the FCA’s largest fraud prosecution
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...
ASA rules on RAPR prominence in TV ad
The ASA has published a ruling which upheld a complaint that the representative APR (RAPR) in an advertisement for Sunny Loans was insufficiently prominent. The advert’s ‘incentives’ that triggered...
Emma RadmorePRA Regulatory Update – August 2018
The August edition of the PRA’s Regulatory Digest includes: news about a New Insurer Start-up Unit. This is a joint initiative with the FCA. The dedicated page on the Bank of England’s website includes a...
FCA bans individual
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...
ESMA renews binary option ban
ESMA has confirmed the ban on binary options will remain in place for a further three months. The current ban, which prohibits marketing, distribution or sale of binary options to retail clients, expires on 2 October...
Firms’ permissions cancelled for failure to be open and co-operative with the FCA
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...
FOS focuses on fraud and scams
FOS’ latest Ombudsman News focuses on frauds and scams. It comments on the loopholes in new technologies that fraudsters use, and the challenges of addressing a complaint where both customer and bank are adamant...
FCA prosecutes individual for unauthorised investment scheme operation
FCA has started criminal proceedings against Mark Starling for three offences relating to operating CIS without authorisation or exemption over a 9 year period and of fraud. Mr Starling is alleged to have operated...
FOS update on publication of complaints data
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...
FCA complaints handling review findings
The FCA has published its findings of the review of how Non-deposit Taking Mortgage Lenders (NDTMLs) and Mortgage Third-Party Administrators (MTPAs) handle complaints. In particular the review looked at how NDTMLs and...
All-Party Parliamentary Group calls for full statutory inquiry into business banking sector
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...
Tribunal backs decision to ban
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...
Tribunal rules on Validation Order on credit agreements brokered by unauthorised firm
The Tribunal has handed down its decision in the case of Plexedes Chickombe and 44 others v the FCA and Clydesdale Financial Services Limited trading as Barclays Partner Finance (Clydesdale) as interested party. The...
FCA updates on high-risk products and retail investors
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...
FCA confirms no action will be taken against RBS for treatment of SME customers
The FCA has published an update on its investigation into RBS’s treatment of small and medium-sized enterprise (SME) customers transferred to its Global Restructuring Group (GRG). The FCA commissioned...
FCA makes new rules
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...
FCA bans individuals for misleading consumers
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...
FCA publishes intervention approach documents
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...
FCA responds on complaints
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 publishes annual enforcement report
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...
Treasury consults on pension cold calling ban
Treasury is consulting on a proposed ban on cold calling in relation to pensions. The consultation is a technical consultation on the wording of the legislation necessary to implement the ban, as the policy decision has...
FCA publishes Annual Report
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...
FCA thinks about price discrimination
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...
New economic and cybercrime court agreed
A new court dedicated to cybercrime, fraud and economic crime is to be built on the site of Fleetbank House, and is expected to be completed in 2025.
Themes from thematic reviews
We recently wrote an article for Compliance Monitor setting out themes from recent FCA thematic reviews.
FCA makes new rules
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...
Treasury Committee engages with FCA over TSB IT migration
Nicky Morgan and Andrew Bailey have exchanged letters of the problems customers faced following TSB’s IT migration. The Treasury Committee had asked about the work FCA had done in advance of the planned migration...
FCA fines Canara Bank for AML failings
FCA has fined Canara Bank £896,100 for failings in its AML systems, and has restricted it from accepting deposits from new customers for 147 days. FCA found that, for a period of over 3 years, the banks failed to...
FCA publishes quarterly consultation
FCA’s latest quarterly consultation proposes the usual minor miscellaneous changes to its Handbook, including; changes to the appointed representatives appointment firm: the changes are spurred on by IDD changes...
Carillion inquiry criticises regulator
Carillion’s rise and spectacular fall was a story of “recklessness, hubris and greed”. Last week, the Work and Pensions Committee and the Business, Energy and Industrial Strategy Committee published the final...
Gavin EllisonMemorandum of understanding between FCA and Insolvency Service
The FCA has published a memorandum of understanding (MoU) it has entered with the Insolvency Service (IS). The MoU sets out the agreement between the IS and the FCA that governs the exchange of information to better...
FCA bans director for misappropriation of client money
The FCA has today published a decision notice in which it has banned a director, Darren Newton, from working in any regulated activity in the financial services sector. The FCA found that Mr Newton had used...
SRA fines law firm MLRO for breach of MLRs
The Solicitors’ Regulation Authority has fined Anthony Gale, partner at Maurice Smiths solicitors who was also its compliance officer and MLRO, £10,000 for various conduct failings in relation to a number of...
Financial Guidance and Claims Act gets Royal Assent
The Financial Guidance and Claims Act has received Royal Assent. The Act: establishes a single financial guidance body, and sets out its objectives, functions and funding details. It also sets out requirements on...
Regulators fine Barclays CEO for breach of SMR requirements
PRA and FCA have published the first final notice for breach of an Individual Conduct Rule. They have jointly fined James (Jes) Staley £642,430 for breach of Individual Conduct Rule 2 (failure to act with due skill...
Barclays make statement over Staley investigations
Barclays has confirmed that FCA and PRA have issued draft warning notices in respect of their investigations into the the bank and its group CEO Jes Staley in respect of an attempt by Mr Staley to identify the author of...
FCA and PRA publish business plans
The FCA and the PRA have both published their business plans for 2018/2019. The FCA’s business plan shines a spotlight on consumer protection, including in relation to pension products and high-cost credit, as an...
FCA and PRA consult on 2018/2019 regulated fee and levy rate proposals
The FCA and PRA have, separately, published consultation papers on regulated fees and levies for 2018/19. In its consultation paper, the FCA sets out the proposed 2018/19 regulatory fees and levies for itself, the...
FCA clarifies cryptocurrency regulatory status
FCA has clarified its views on the regulation of cryptocurrency derivatives. It has previously explained that cryptocurrencies are, of themselves, not regulated although they may be part of other regulated products or...
FCA updates on Capital Alternatives
FCA has reported that the defendants in its case against Capital Alternatives have been ordered to pay compensation and that it has obtained new undertakings from or injunctions against some of the defendants to protect...
FCA cross over insurance renewals
FCA has warned firms it is prepared to take action against those who have failed to implement rules that have now been in force for a year designed to clearly show customers who are due to renew their general insurance...
Complaints Commissioner concerned about information sharing between FOS and FCA
In a recent report the Complaints Commissioner expressed concern about the absence of published information about how and in what circumstances information about live ombudsman cases may be shared between the FOS and...
FCA sets out supervision and enforcement approach
FCA has published a draft of its approach to enforcement and supervision. The documents follow its publication of its Mission, in which it committed to publishing a series of documents setting out how it carries out its...
FCA outlines approach to authorisation
Sarah Rapson has spoken of FCA’s approach to authorising firms. She focused on FCA’s use of authorisation as a way to prevent harm, and its focus on using it proportionately. As a result, the information it...
FCA looks back on past 5 years
John Griffith-Jones has reflected on FCA’s first 5 years of operation, since it took over from the FSA. He outlined: highlights – specifying FCA’s engagement with pension exit charges, general...
FCA focuses on closet trackers
FCA has updated on its work reviewing potential closet tracker funds and closet constrained funds – funds that look like and charge fees in the same way as active funds do, but are managed like passive funds...
Treasury Committee asks FOS for answers
The Treasury Committee has written to Caroline Wayman, Chief Executive of FOS, following an episode of “Dispatches” that suggested FOS was staffing cases with individuals with inadequate training or...
FCA Discussion Paper on transforming culture in financial services
As part of its ongoing work on culture and governance, the FCA has published a discussion paper, comprising a series of essays from academics and industry thought leaders covering: what a ‘good’ culture...
FSB publishes final version of supplementary guidance on sound compensation practices
The Financial Stability Board (FSB) has published the final version of its Supplementary Guidance to the FSB Principles and Standards on Sound Compensation Practices. It consulted upon this guidance in June 2017, as...
Treasury Committee welcomes Co-op review
Nicky Morgan has welcomed the “long overdue” review into the Co-op Bank. She had written to Andrew Bailey in February to ask why the review, announced by George Osborne in November 2013, had not yet started...
FCA bans former Co-Operative Bank Chair, Paul Flowers from the financial services industry
The FCA has published a final notice, issued to Paul Flowers, the former Chair of the Co-Operative Bank between 15 April 2010 and 5 June 2013, banning him from the financial services industry. The FCA found that Mr...
FCA fines and bans former trader for benchmark manipulation
FCA has fined Guillaume Adolph, a former short-term interest rate derivatives trader with Deutsche Bank, £180,000 and banned him. It had originally issued its warning notice in early 2014 but proceedings were stayed...
FCA updates on consumer credit landscape
Andrew Bailey has spoken to the FLA on the current consumer credit landscape. He noted the constant fall in the real cost of debt which has supported the rise in household borrowing, and the growth in consumer credit...
Treasury Committee concerned at GRG “rebrand”
The Treasury Committee is concerned at evidence RBS has provided to it that indicates that 75% of current RBS restructuring employees previously worked in the GRG. Nicky Morgan said that although Ross McEwen, RBS Chief...
The FCA fines Vanquis £1,976,000 for failure to disclose full price of an add-on product
The FCA has fined credit card lender, Vanquis, £1,976,000 and ordered it to pay compensation to customers for failing to disclose the full price of an add-on product called Repayment Option Plan. In particular, the FCA...
CMA updates on investment consultants investigation
The CMA has published an update of its progress on its market investigation into investment consultants and fiduciary managers. Since it started its reference last September, it has, among other things, visited three...
FCA writes to CEOs on prudential returns
FCA has published a “Dear CEO” letter setting out its comments on the quality of prudential returns. It is concerned that a significant number of firms are submitting returns that contain inaccurate or...
Tribunal rules on third party rights
The Tribunal has handed down its decision in One Insurance Ltd’s case against FCA. The company had complained that FCA had identified it in its notices to One Call Insurance Services and John Radford, and that the...
Treasury Committee publishes RBS report
The Treasury Committee has published the final, unredacted skilled persons’ report into the RBS treatment of SME customers in its Global Restructuring Group. It had given FCA until 16 February to publish this, but...
FCA updates on service standards
FCA’s new-look update on its service standards shows that it met most of its targets for various regulatory tasks, including authorisations, passport notifications, dealing with queries and customer satisfaction...
FCA AND PRA APPOINT NEW CHAIR OF THE FSCS
The FCA and PRA have today announced the appointed of Marshall Bailey as the new Chair of the Financial Services Compensation Scheme Limited (FSCS) with effect from 1 April 2018. Marshall Bailey succeeds Lawrence...
Further SFO charges in Barclays case
The Serious Fraud Office (SFO) has charged Barclays Bank Plc (Barclays) with unlawful financial assistance contrary to s151(1) and (3) of the Companies Act 1985. This relates to the financial assistance Barclays gave to...
Illegal money lender imprisoned
An illegal money lender has been sentenced to imprisonment of 3.5 years for offences under FSMA and the CCA. In addition to bringing the successful prosecution against Dharam Gopee, FCA also successfully obtained a...
Illegal scheme operator imprisoned
In the latest sentence to be handed down following FCA’s successful prosecutions of individuals involved in the Symbiosis Healthcare scheme, Samrat Bhandari has been imprisoned for 3.5 years and disqualified from...
FCA publishes decision notices on client money
FCA has published decision notices in respect of One Call Insurance Services Limited and its majority shareholder John Radford. FCA plans to fine the firm £684,000 and restrict it from charging renewal fees to...
FCA fines online broker £1,049,412 for poor market abuse controls and failure to report suspicious client transactions
The FCA has fined online broker, Interactive Brokers (UK) Limited (IBUK), £1,049,412 for failings in its post-trade systems and controls for identifying and reporting potential market abuse between 6 February 2014 and...
FSCS PUBLISHES PLAN AND BUDGET FOR 2018/2019
The Financial Services Compensation Scheme (FSCS) has published its Plan and Budget for 2018/2019. The Plan and Budget outlines the FSCS’s expected management costs and initial levy forecasts financial services...
Immigration status checks on account holders begin
The Home Office has confirmed that banks and building societies have started carrying out checks against their personal current account holders to establish whether any account holder is an illegal immigrant. They are...
ICO fines 4 firms for nuisance calls and spam texts
The ICO has fined four firms a total of £600,000: Barrington Claims Limited had made over 15 million automated calls about PPI; Newday Limited used other firms to send 44.7 million spam emails to promote its financial...
FCA updates Enforcement Guide as PRIIPs Regulation comes into force
The FCA has published a legislative instrument that amends its Enforcement Guide to reflect the implementation of the Packaged Retail and Insurance-based Investment Products Regulation (PRIIPs Regulation). The changes...
TI criticises UK role in laundering
Transparency International has highlighted and criticised the role London plays in international money laundering. It comments on a new investigation focusing on structures used to help sell frozen assets of the former...
FCA fines and bans former RBS trader, Neil Danziger
The FCA has fined former Royal Bank of Scotland (RBS) interest rate derivatives trader, Neil Danziger, £250,000 and has prohibited him from performing any function in relation to any regulated financial activity. The...
FCA consultation paper on aligning FSCS levy time period
The FCA has published a consultation paper on aligning the Financial Services Compensation Scheme (FSCS) levy time period (CP18/1). The FCA recently made changes to the FSCS funding arrangements as part of a broader...
Court dismisses Angela Burns appeal
The Court of Appeal has handed down judgement following an appeal by Angela Burns, former NED of 2 mutual societies. In 2012, the then FSA had fined and banned her after it found she had recklessly, and in breach of her...
FCA writes to CEOs on PFOF
FCA has written a Dear CEO letter, expressing its concerns on the continued practice of “payment for order flow”. Despite FCA having criticised the practice in the past, it is aware that many brokers are...
FCA highlights transaction reporting and MAR issues
The latest edition of Market Watch looks at: a reminder that an investment firm’s transaction report must reflect the transaction from its own perspective, reporting its immediate counterparty or client (whether...
FCA makes new rules
At FCA’s Board meeting on & December, it made several new rule instruments, covering (among other things), several changes to take effect from 3 January 2018: minor changes relating to MiFID 2 implementation...
FCA fines broker for misleading customers
FCA has fined Bluefin Insurance Services Limited £4,023,800. It found the firm had inadequate systems and controls, as it held itself out to be truly independent but did not properly manage the conflicts that arose by...
CMA consults on its 2018/19 annual plan
The Competition and Markets Authority (CMA) is consulting on its draft annual plan, which sets out its plans and priorities over the next year. Interested parties have the opportunity to provide views and comments on...
FCA stops airport parking CIS
FCA has investigated the operations of Park First Limited in relation to airport parking investment schemes. It believed the firm, which is not authorised, was operating a CIS. The firm has agreed to offer investors the...
FCA succeeds in investment scheme prosecution
Two individuals have been found guilty of various offences relating to carrying on regulated activities without authorisation, false and misleading impressions and being a company director contrary to the Theft Act, in...
FCA starts misleading pension statements proceedings
FCA has announced the start of civil proceedings against Avacade Limited, which traded as Avacade Investment Options, and Alexandra Associates (U.K.) Limited, trading as Avacade Future Solutions, and against Craig...
FCA issues first statement of objection to asset managers
FCA has issued a statement of objections to 4 asset managers who it believes may have acted in breach of competition law. The statement (which has not been published) is the first time FCA has brought a case using its...
Initial coin offerings: regulation and the risks
We’ve written a briefing on recent regulatory warnings about ICOs, and how they may fall within the UK’s regulatory perimeter.
FCA updates on wholesale banks compliance review
FCA has published a note summarising the results of its review of the compliance function in wholesale banks. It had asked 22 wholesale banks (including global banks, medium-sized banks focusing on specific areas or...
FCA fines former BAML trader for market abuse
FCA has fined Paul Walter, a bond trader formerly with Bank of America Merrill Lynch International, £60,090 for market abuse. It found Mr Walter created a false and misleading impression about the supply and demand in...
FCA consults on fees
FCA has published its annual consultation paper on regulatory fees and levies. Key proposals include: the proposed tariff data FCA will use to calculate insurers’ FCA periodic fees and the FOS levies, building on...
ESMA warns investors and firms on dangers of ICOs
ESMA has become the latest body to denounce initial coin offerings (ICOs), issuing statements directed at investors and firms highlighting the distinct risks involved. Echoing FCA’s previous warnings , ESMA has...
Capita faces public censure and £66m pay-out
FCA has issued a final notice against Capita Financial Managers Limited (CFM), publicly censuring the firm and ordering it to pay up to £66m in compensation to investors that suffered as a result of CFM’s...
Request for extension of time denied as Upper Tribunal considers section 393 FSMA
The Upper Tribunal (Tax and Chancery Chamber) has a denied a request for an extension of time to a Mr Stephen Cooper, who had challenged his identification in an FCA decision notice against WH Ireland Limited, outside...
Insurance broker loses authorisation over non-compliance with FOS award
The Upper Tribunal (Tax and Chancery Chamber) has upheld FCA’s decision to cancel the permission of Larksway Investments (an insurance broker), following non-compliance with a FOS award. FOS had upheld a complaint...
Up next from FCA
FCA’s latest Policy Development Update promises, before the end of the year: policy proposals for regulatory fees and levies policy statement on the second consultation on FAMR implementation policy statement on...
FCA reminds principals of AR risks
FCA has issued a further warning to firms that act as principal to appointed representatives or IARs. The warning follows an alert it published last year because of concerns over introducers having an inappropriate...
FCA consults on market conduct codes
FCA has published a consultation paper setting out its approach to supervising and enforcing the SMCR, and a wider discussion on extending Principle 5 (standards of market conduct) to the unregulated activities of...