HM Treasury has published its “Anti-money laundering and countering the financing of terrorism: Supervision Report 2020-22“. The report addresses the performance of anti-money laundering (“AML“)...
Category - Enforcement & Litigation
Duncan ScottFCA imposes restrictions on investment firm
FCA has published a first supervisory notice to Pello Capital Limited imposing various requirements on it with immediate effect (from the date of its publication on 15 November), as a result of concerns about the...
Emma RadmoreSupreme Court judgment in Stanford/HSBC case looks at recoverable losses
The Supreme Court has held that, where HSBC actioned instructions that may have been part of a fraud, but which resulted in creditors being repaid, then regardless of whether it had a Quincecare duty and, if it did, had...
Onerous or essential: banks’ duties and APP fraud
Read our article by Stephen Dilley and Rasmita Roy Chowdury, looking at the history and case law relating to banks’ duties and APP fraud reimbursement.
FOS consults on plans and budget
FOS is consulting on its plan and budget for 2023/24. As part of the consultation, it asks: what volumes and trends it should be expecting in the areas of banking and credit, insurance, investments and pensions and...
The Edinburgh reforms – and more
See our article, summarising various FIN posts over the past week on the state of play of the FSM Bill and the Edinburgh reforms.
FCA fines Metro Bank for Listing Rule breaches
FCA has fined Metro Bank over £10m and has also decided to fine its former CEO and CFO £223,100 and £134,600 for being knowing concerned in the bank’s breach of the Listing Rules, which involved publishing...
FCA fines brokers for market abuse detection failings
FCA has fined 3 firms within the BGC and GFI group a total of £4,775,200 for failure properly to implement the MAR trade surveillance requirements, which meant there was an increased risk that the firms would not detect...
FCA bans bond traders for market manipulation
The FCA has published Decision Notices banning Diego Urra, Jorge Lopez Gonzalez and Poojan Sheth from performing any functions in relation to regulated activity. The FCA considers that the traders placed large...
Lucy HadrillFCA fines adviser for unsuitable BSPS advice
FCA has fined Pembrokeshire Mortgage Centre Limited £2,354,331 for giving unsuitable advice to consumers to transfer out of the BSPS and other DB pension schemes. FCA found the firm, which is in liquidation, had advised...
FSM Bill report stage on 7 December
The FSM Bill is to have its report stage and third reading in Parliament on 7 December, after receiving the Bill with amendments from the Public Bills Committee. It is possible for Parliament to make amendments at...
PSR fines for interchange fee breach
The PSR has fined Barclays £8.4m for failing to provide retailers with full information about the costs of its card services. The Interchange Fee Regulation requires banks to provide retailers with transaction...
FCA fines JBI for breaches of Principle
FCA has fined Julius Baer International £18,022,500 for breaches of Principles 1, 3 and 11 at various times between 2007 and 2014. It has also decided to ban 3 individuals – all of whom have taken their case to...
BBRS report highlights complaints themes
BBRS has published its Case Insights report which highlights themes and issues arising from customer complaint data to end-July. The BBRS service was launched in February 2021, and by the end of July 2022, it had...
Nicola RadfordFCA bans individual
The FCA has banned Carlo Palombo from performing any regulated activity. Mr Palombo was convicted of conspiracy to defraud in respect of fixing EURIBOR whilst an employee of Barclays and was sentenced to 4 years’...
Regulators respond to MP on HBOS investigation queries
Sam Woods (PRA) and Nikhil Rathi (FCA) have written to Kevin Hollinrake MP on behalf of the APPG on Fair Business Banking. The regulators have responded to Mr Hollinrake’s questions following the closure of...
FOS feeds back on future funding
FOS has published feedback following its discussion paper on its future funding. Following comments, it will not take forward some of the options on which it sought views, such as charging professional representatives...
FCA gets judgment against unauthorised mortgage broker
FCA has obtained a judgment against a company, its parent, their director and his father. It found they arranged high-interest, unaffordable bridging loans for vulnerable consumers who were about to be evicted from...
FCA reacts to FTX failure
FCA has noted that UK customers of FTX may be alarmed following its provisional liquidation in the Bahamas and filing for bankruptcy in the US. It had previously warned customers that FTX is not regulated in the UK and...
FCA bans director
FCA has banned Ashkan Zahedian, former sole director of an authorised consumer credit firm, following his conviction for serious, violent offences that took place while he was an approved person. FCA said the offences...
FCA places requirements on firm that gave misleading information
FCA has issued two supervisory notices against Samweb (UK) Limited, a claims management company, following concerns that its communications could mislead customers. FCA was concerned the firm had: breached various...
CMA writes to Barclays on PPI breaches
The CMA has written a public letter to Barclays because the bank failed to send reminders to up to 1,306 customers about their payment protection insurance (PPI) policies. This meant a breach of Article 4 of the Payment...
FCA updates on DB pension redress calculations
The FCA has received information that a number of firms are not calculating defined benefit pension redress correctly. The information which suggests that these firms are not considering ongoing fund costs and/or fully...
FOS blog looks at holiday insurance complaints
FOS has published a blog looking at complaints involving holiday cancellations because of positive or delayed Covid test results. It has suggested some tactics insurers might apply which may prevent complaints. These...
BBRS publishes reports on customer satisfaction and complaints
The Business Banking Resolution Service (BBRS) has published its Customer Satisfaction Report, reporting customer journey feedback for the 2 months to late August. 72% of customers said they were able to complete the...
Highlights of FSMB debates from 25 October
The 3rd and 4th sittings of the Public Bill Committee debate on the FSM Bill took place on 25 October. After the evidence sessions from witnesses on 19 October, the line-by-line scrutiny of the Bill has now started...
Emma RadmoreCourt finds mortgage adviser had no duty to investigate underlying investment
The High Court has ruled on a case brought by investment fraud victims in a clarification of mortgage advisers’ duties. The judgment in Taylor & Anor v Legal and General Partnership Services Ltd [2022] EWHC...
Further FSMB revisions released
Parliament has published the latest raft of proposed amendments to the FSM Bill. These include: a change to the very first sub-clause, replacing the revocation of the EU and EU-derived legislation in the schedule so...
FCA decides to fine Barclays for disclosure failings
FCA has published decision notices against Barclays plc and Barclays Bank plc, proposing a fine of £50m in relation to failure to disclose certain arrangements with Qatari entities as part of capital raising in 2008...
FCA publishes H1 complaints data
FCA has published the complaints data for H1 2022, which shows: a 1% increase in complaints from the previous period (1.88m complaints) the biggest increase was in the decumulation and pensions group (15%) with a 5%...
PRA fines MS Amlin for governance failings
PRA has fined MS Amlin Underwriting Limited nearly £10m for failings in its governance, controls and risk management. The failings lasted for over 5 years and related to the governance and oversight of underwriting...
Claimant permitted to apply for judicial review of FOS ‘fairness’ decision
The High Court have granted a Claimant permission to make an application for judicial review in respect of a decision of the Financial Ombudsman Service (FOS) against the Claimant in respect of the provision of credit...
Mark Steward to step down as FCA Enforcement chief
Mark Steward is to step down as FCA’s executive director of enforcement and market oversight after 7 years. He will leave FCA in Spring 2023. In addition to leading many key precedent-setting cases, Mr Steward...
FSMB Committee stage scheduled for 19 October
An update to the Parliament website shows the Committee stage for the Financial Services and Markets Bill will start on 19 October. After the line by line debate is complete, the Bill will be republished for report...
FCA updates Whistleblowing data
FCA has published data on whistleblowing reports received between April and June 2022. It received 243 new reports containing 474 allegations, mainly through its online reporting form, but a sizeable number by email or...
Ombudsman News and new FOS UCIS pages
The latest edition of Ombudsman News highlights the recent complaints data we’ve previously reported on, and gives guidance on complaints relating to UCIS. FOS is seeing increasing complaints about advice to...
Court dismisses JR application on FOS decision
The High Court has refused a renewed application by Charles Street Securities Europe LLP for permission to apply for judicial review of a FOS decision made in February 2021. The dispute focused on whether Mr R, a client...
FOS publishes H1 complaints data
FOS has published its regular half-yearly update on complaints data relating to individual businesses. 212 businesses feature, with an average uphold rate of 37% (the same as the previous period). FOS has also reported...
FCA updates on Link Fund Solutions investigation
FCA has confirmed it has now issued Link Fund Solutions Ltd with a draft Warning Notice following its investigation into the circumstances leading up to the suspension of the Woodford Equity income Fund. The firm has 14...
FCA imposes conditions on CiC
On 12 September, FCA announced that it has imposed conditions on a proposed change in control. Dye & Durham is looking to take over the Link Group, which involves the acquisition of 7 FCA-authorised firms. One of...
CMA issues directions to NatWest for bundling breaches
The CMA has issued directions to NatWest following the bank’s breach of undertakings which prohibited it from requiring SME customers which held certain bank loans to also hold business current accounts (BCAs)...
FCA responds to Premier FX complaints
FCA has upheld or partially upheld 5 out of the 31 complaints it received from people who lost money when money remitter Premier FX collapsed. The issues relate to events which happened some time ago, and in relation to...
Court refuses permission to appeal on CCA default notice
The Supreme Court has refused the Appellant debtor’s application for permission to appeal the Court of Appeal’s decision in Goodinson (Appellant) v PRA Group (UK) Ltd (Respondent) [2021] EWCA Civ 957...
Harshil PatelFCA consults on transfer advice redress
FCA is consulting on updates to how it calculates redress for unsuitable DB pension transfer advice. The consultation: confirms that FCA has carried out a review that shows that the current methodology is appropriate...
Court refuses judicial review on FOS mortgage rate decision
The High Court has found in favour of FOS in an application by a mortgage lender for judicial review of FOS’ decision on a complaint about mortgage interest rates. Mrs D had taken out a 10 year interest only...
Ombudsman News highlights gambling complaints
The latest edition of Ombudsman News from FOS highlights: the recent appointment of a new Deputy Chief Ombudsman and COO, both of whom will take up their roles by October; and FOS’ new guidance on the treatment of...
Employee fairly dismissed for failing to disclose that he had been made bankrupt
We have commented on the recent Employment Appeal Tribunal (EAT) decision in Pubbi v Your-Move.co.uk [2022] EAT 96 in which an employee was dismissed for failing to disclose that he had been made redundant, following up...
Ben DuxburyNeed more detail on the Financial Services and Markets Bill?
We’ve produced a detailed summary of the key aspects of the Financial Services and Markets Bill, following up on our headline post. While the Bill won’t be having its second reading until September, keep an...
CMA orders bank to send transaction histories
The CMA has ordered Monzo to send transaction histories for 13,000 customers who closed their accounts with the bank but were not sent the history required by the Retail Banking Market Investigation Order. The breaches...
Court confirms no statutory trust for unsafeguarded EMR/PSR assets
The Insolvency and Companies Court has given directions at the request of the liquidators of Allied Wallets Limited, a failed payment services firm, which was subject to the PSRs in respect of electronic payment...
CMA finds that six high street banks broke CMA banking rules
Six high street banks have broken rules imposed by the CMA under the Retail Banking Market Investigation Order 2017. Banks and building societies are required to follow strict rules when it comes to informing customers...
New Financial Services and Markets Bill in Parliament
The Government has introduced the Financial Services and Markets Bill into Parliament. The Bill was introduced on 20 July and had its first reading, but no date was set for the second reading. In his first Mansion House...
Tribunal decides dismissal for bankruptcy is fair
A recent Employment Appeal Tribunal decision considered whether Your-Move (YM), an Estate Agent, had unfairly dismissed a consultant (Mr Pubbi – the Claimant) for failing to disclose that he had been made bankrupt. The...
Complaints Commissioner publishes Annual Report
In this year’s report by the Complaints Commissioner dealing with complaints against the Financial Services Regulators, Amerdeep Somal outlines what her office dealt with, and how it compared to last year. 935...
High Court finds that Robert Tchenguiz was correctly classified as an elective professional client and that there was no breach of COBS rules
Background Investor Robert Tchenguiz (T) had opened a spread betting account with CMC Spreadbet plc (CMC), and CMC had elected to treat T as a ‘professional client’. T’s classification as an elective...
Upper Tribunal finds failings with crypto trader’s AML compliance
The Upper Tribunal (Tax and Chancery Chamber) has published its decision in Vladimir Consulting Ltd (VCL) v Financial Conduct Authority, in which it has analysed whether VCL’s approach to business was compliant...
FCA agrees end to unauthorised deposit taker case
FCA started court proceedings in December 2019 against Bright Management Solution Limited, which it alleged was operating an unauthorised deposit taking scheme. The matter was due to come to trial this month, but a...
FCA seeks retrial in insider dealing case
Following the Court’s decision to discharge the jury after they were unable to reach a verdict following an 8-week trial, the FCA has announced that it will pursue a retrial of Stuart Bayes and Jonathan Swann for...
FCA update on market abuse and manipulation
Tackling market abuse is one of the FCA’s strategic priorities. Given recent press reports about the FCA’s approach, the FCA outlined the work it does to tackle insider trading and manipulation and to warn...
FIN. TeamUpper Tribunal confirms compensation and validation possible for credit breaches
In its recent decision, the Upper Tribunal drew a distinction between the compensation regime available to consumers under section 28(2) of FSMA and the enforceability of a regulated credit agreement under section 28(3)...
FOS issues discussion paper on future funding model
On 14 June 2022, the FOS published a discussion paper on possible changes to its future funding model.. This follows the FOS’s commitment in their action plan to change and improve the organisation to deliver a...
FCA fines guarantor lender for Principles and CONC breaches
The FCA has published the final notice issued to TFS Loans Ltd (in administration), a provider of guarantor loans. The FCA has fined TFS £811,900 for breaches of Principles 3 and 6 and CONC. It is now required to...
Post-legislative assessment of the Fraud Act 2006
The Ministry of Justice has published a memorandum on the Fraud Act 2006 which provides an updated post-legislative assessment of the Act for submission to the House of Lords Select Committee in light of rising digital...
FOS announces new Chief Executive and Chief Ombudsman
FOS has appointed Abby Thomas to the role of Chief Executive and Chief Ombudsman. She joins from Virgin Media O2 and was trained as a strategy consultant before working for a number of telecoms companies.
Court finds introducer in breach of FSMA but allows commission to stand
Kinled Investments Limited introduced an investor to Zopa Group Limited. Kinled claimed a £4.2m fee from Zopa for its intermediary work when the investor made a second investment, while Zopa counterclaimed £345,000 as...
Court looks at meaning of “insurance”
A court has considered whether a law firm that offered an indemnity against adverse court orders when acting for claimants on a conditional fee basis was in fact carrying on insurance business. The defendant firm of...
Privy Council declines to extend the Quincecare duty to protect beneficial owners of funds
The Privy Council has handed down its decision in Royal Bank of Scotland International LLP (Bank) v JP SPC 4 and another [2022] UKPC 18, in which it confirmed that as a matter of law, banks do not owe a duty of care...
FCA sets up BSPS information page
FCA has published a new page on its website in which it gives answers to requests for further clarification that it has received from respondents to its consultation on the British Steel Pension Scheme redress scheme...
FRC disciplines KPMG and Partner over Rolls Royce audit
The Financial Reporting Council has issued its final decision notice after its investigation into KPMG Audit plc and the Audit Engagement Partner, Anthony Sykes, in respect of the statutory audit of Rolls-Royce Group...
FOS secures up to £22 million in redress for consumers
FOS has published the results of a temporary outcomes code initiative launched in November 2021 As a result of the work done by the FOS, more than 90 businesses has resulted in 6,877 offers being made to customers and...
Paypal withdraws from FOS voluntary jurisdiction
PayPal (Europe) S.a.r.l et Cie, SCA is withdrawing from FOS’ voluntary jurisdiction from 1 December 2022. The company became subject to the compulsory jurisdiction after Brexit when it joined the TPR. But the...
FCA fines and bans firms and individuals over pensions advice
FCA has issued final notices to two firms in relation to their pension advice business and misleading the FCA. The fact pattern for both firms was similar, involving their use of a Pension Review and Advice Process...
PSR takes action against banks for non-compliance with the IFR
PSR has taken action against NatWest, RBS, Ulster Bank and Coutts for failing to comply with the Interchange Fee Regulation. The banks incorrectly treated a number of cards as being ‘commercial’ when they should have...
New proposal for distance selling of financial services
Following its request for feedback last year, the European Commission has adopted reforms of the current EU rules concerning financial services contracts concluded at a distance. The proposal aims to simplify and...
FCA bans 5 directors for causing losses to pension customers
The FCA has banned five directors of financial advice firms from working in financial services, after they caused significant losses to pension customers. The bans, and fines of over £1m, follow findings by the Upper...
FCA publishes H1 2022 complaints data
FCA has published its H1 2022 complaints data. In 2021 H2, financial services firms received 1.84m complaints, 10% lower than in 2021 H1 (2.04m). This is the lowest level recorded since 2016 H2. The insurance and pure...
FOS publishes complaints data from H2 2021
Between 1 July and 31 December 2021, FOS received a total of c.73,200 complaints of which 37% were upheld.
FOS has also published its latest half-yearly data on the number of complaints received about CMCs.
Court finds mortgage loan not “by way of business”
The High Court has handed down its judgment in the case of Arthistory Ltd and Mr and Mrs Campbell. The Campbells own a property and had granted an option to Arthistory (the Claimant) to acquire it. The Claimant sought...
FCA to remove credit broker permissions
FCA has published its first supervisory notice against Semantic Business Services Ltd, a secondary credit broker. It plans to remove the firm’s permissions because: the firm has links with a number of other firms...
PSR updates on competition in pre-paid cards sector
The PSR has publishes the non-confidential version of its decision following its investigation into two cartels in the pre-paid cards market. In January it confirmed its fines totalling around £33m on Mastercard...
FCA publishes BSPS compensation scheme proposals
FCA has published its proposals for a compensation scheme to compensate former members of the British Steel Pension Scheme who received unsuitable advice to transfer out. FCA says that almost half the advice it reviewed...
Ombudsman News looks at storm damage
The latest edition of Ombudsman News from FOS covers not only its plan and budget for 2022/23 (which FIN has covered separately) but also guidance for consumers about storm damage complaints. The guidance contains...
CMA issues SME banking directions to HSBC
CMA has issued directions to HSBC under the SME banking undertakings 2002. The directions stem from breaches notified over the past 18 months in respect of 221 loans impacting 204 customers since 2002. They primarily...
FCA fines asset manager and former investment director
FCA has fined GAM International Management Limited £9m, and its former Investment Director and Business Unit Head Timothy Haywood £230,000 following failure to conduct business with due care and attention, and failure...
FOS outlines strategic plans for 2022/23
FOS has published its plans and budget for 2022/23. In the coming year, FOS: expects to receive 177,000 complaints and resolve 220,500 complaints; will continue to ensure it is equipped to respond to complexity and...
Pension adviser refused judicial review of FOS decision
A pensions transfer and opt out adviser, Portal Financial Services LLP, had given advice to several clients introduced by a third party advisory firm which was the AR (Cherish) of another firm whose permissions did not...
FCA updates on operational and cyber resilience following Russian invasion
The FCA has published some pointers that firms should consider regarding operational and cyber resilience following Russia’s invasion of Ukraine. Firms are advised to consider the following: the firm’s ability...
ASA cracks down on misleading crypto ads
ASA has issued an Enforcement Notice to over 50 firms which advertise cryptocurrencies, instructing them to review their ads and to ensure they understand and are complying with the rules so that consumers are treated...
NAO reports on BSPS
The National Audit Office has published its report on its investigation into the British Steel Pension Scheme. When BSPS was restructured in 2017 44,000 of its members had the opportunity to transfer out of the scheme...
Lloyd’s responds to market misconduct
Lloyd’s has issued a notice of censure to Atrium, a managing agent in the Lloyd’s market. The firm admitted three charges of misconduct, and Lloyd’s Enforcement Board levied its largest ever fine of...
FCA responds on LCF Complaints
FCA has set out its response to the Complaints Commissioner’s report on its handling of the failure of LCF in respect of assessing complaints against it. It says it is sorry for the mistakes it made. It has...
CAT determines the ‘domicile date’
CAT has published its Judgment giving further guidance on the ‘domicile date’, which is the date specified in a CPO. The domicile date operates to determine the persons who fall within the class definition...
ESMA publishes peer review on cross-border supervision
ESMA has published its peer review on cross-border supervision of investment firms, and. It found many shortcomings, and says that “home” regulators need to make significant improvements to their approach...
High Court rules on application of CCA ‘business purpose’ exemption to multi-borrower loans
In Campbell v Tyrrell & Ors [2022] EWHC 423 (Ch), the high court considered the application of the ‘business purpose’ exemption in s.16B(1) of the Consumer Credit Act 1974 (the “CCA“) to a...
Former Redcentric CFO sentenced to five and a half years imprisonment
Following the guilty verdict back in February of the two former finance chiefs at a London-listed IT firm found to be misleading investors after they falsified the company’s accounts, Tim Coleman has now been sentenced...
FCA publishes Consumer investments data review
The FCA has published its third Consumer investments data review. The review provides an overview of FCA’s work to protect consumers from investment harm between April and September 2021. This follows FCA’s...
Emma BondFCA discontinues action against individual for failure to comply with statutory Notice
The FCA has issued a notice of discontinuance in relation to the prosecution of Craig Whyte. Mr Whyte had previously been charged with an offence of failing to comply with the a statutory Notice issued under Section 49...
BBRS publishes Post-Implementation Review
The Business Banking Resolution Service (BBRS) has published the first part of its Post-Implementation Review (PIR). The aim of this review was to assess how well the BBRS has delivered the recommendations contained in...
FCA makes new rules
The FCA’s latest Handbook Notice confirms changes to: apply the rules set out in the Funeral Planning Conduct of Business (FPCOB) sourcebook to funeral plan providers selling their own plans directly to customers...
FCA fines Barclays over collapsed payment firm oversight
FCA has fined Barclays £783,800 for oversight failings in its relationship with Premier FX, a payments firm which is in liquidation. Barclays was Premier’s sole UK banker. FCA found that Barclays failed to make...