The FCA says it is planning to consult on reform of the investment client categorisation rules to allow firms to act more proportionately when dealing with wealthy or sophisticated investors. The paper, on reform of the...
Category - Topics
Emma RadmoreTreasury updates AML advisory
HM Treasury has updated its AML advisory notice in respect of high risk third countries, following the latest FATF meeting. The changes to the list took effect from the date FATF published it.
Payments and e-money firm Ziglu enters special administration
Ziglu Limited – an authorised e-money and payment services firm – has entered into special administration. David Shambrook and Damian Webb of RSM were appointed joint special administrators of the firm on 7...
Laura WilesPensions Dashboard Programme updates on progress
The Pensions Dashboard Programme (PDP) has provided an update on the progress of the scheme, which launched in April 2025. Over 20m pension records have now been connected to the new platform, and the State Pension as...
BoE fines Vocalink £11.9m for compliance failure
The BoE has fined Vocalink Limited £11.9m in respect of a compliance failure under s.196 of the Banking Act 2009. This marks the first time that the BoE has fined a financial market infrastructure (FMI) firm. Vocalink...
PRA to review LTI limit rule and offers interim modification by consent
Following recommendations by the FPC, the PRA is reviewing the loan to income (LTI) ratio requirements, and offering a modification by consent in the meantime for firms to disapply the relevant rule. The current...
Financial Stability Report considers continued geopolitical risk and uncertainty
The BoE has published the Financial Policy Committee’s latest Financial Stability Report. The FPC found that risks and uncertainty associated with geopolitical tensions, global fragmentation of trade and financial...
BoE sets out thematic findings from 2024 Cyber Stress Test
The BoE has published a report setting out its thematic findings from the 2024 Cyber Stress Test, a voluntary exercise which involved providers and users of wholesale services to model the impact of a suspected cyber attack affecting transaction settlement.
The stress test used three variations of the scenario: a suspected cyber attack; a confirmed cyber attack; and a longer cyber attack.
Key findings included:
Financial stability decisions�– while participants had mature scenario modelling and response capabilities, they lacked a comprehensive understanding of the FPC’s Impact Tolerance and how potential impacts could lead to financial instability.��Firms are encouraged to consider actions to protect financial stability and manage systemic risk from operational disruptions;
Financial stability mitigation
Operational mitigation – some participants had not tested all available workarounds for processing payments, highlighting the need for firms to collaborate with FMIs to ensure awareness and adoption of mitigation options;
Confidence mitigation – participants demonstrated good understanding of the Sector Response Framework (SRF) processes.��However, further work is needed to improve awareness of operational resilience contingency procedures among customer relationship managers and incident responders;
Financial mitigation -while capital is a fungible mitigant to losses, it does not mitigate operational disruption impacts. Service providers needed a better understanding of customer firms’ funding positions to meet liquidity needs during longer incidents;
Disconnection and reconnection – firms’ decisions about disconnecting from critical systems affect their ability to mitigate financial stability impacts.��It is important for firms to understand disconnection and reconnection options, align them with risk appetites, and reflect potential financial stability impacts in their playbooks.��The Cross Market Operational Resilience Group (CMORG) is working on defining best practice reconnection processes.
Treasury Committee to question insurance industry heads
The Treasury Select Committee will hold a one-off oral evidence session with the leaders of four major insurance firms on the state of the insurance industry. MPs are seeking to understand the main challenges, concerns...
Regulators increase mortgage lending threshold
The PRA has amended its Rulebook and the FCA has amended its Guidance on the de minimis threshold for the Loan to Income flow limit in mortgage lending. The Financial Policy Committee had recommended increasing the...
FCA publishes final Credit Information Market Study
The FCA has published its final report with its package of proposed remedies for the Credit Information Market Study. The remedies focus on: data quality; consumer awareness and engagement; competition and innovation;...
FCA fines Monzo for financial crime control failings
The FCA has fined Monzo £21m for failings in its financial crime systems and controls. The failings became apparent as Monzo’s customer base and its product offering grew rapidly, and its financial crime prevention...
Regulators and Lloyd’s agree streamlined managing agent authorisation process
The PRA, FCA and the Society of Lloyd’s have agreed to streamline the regulatory approval process for Lloyd’s managing agents. The changes follow a successful pilot operated in the Lloyd’s market in...
FCA updates PEP guidance
The FCA has published its updated finalised guidance on the treatment of PEPs for AML purposes. The update follows its 2024 consultation, which noted that the old 2017 guidance was still basically suitable, but...
Court looks at “business test” when loans are refinanced
In a repossession case brought by an unregulated lender, Principal Bridging Limited (PBL), the County Court found that where a loan is used to refinance previous borrowing, it is the purpose for which the original loan is taken out which determines whether it is “wholly or predominantly for the purposes of a business” for the purposes of Articles 60C and 60O of the Financial Services and Markets Act 2000 (Regulated Activities Order) 2001 (the RAO).
In this case, the borrower, Mr Lewis took out a bridging loan with PBL (secured as a second charge loan against his primary residence) which was used to refinance an earlier loan (with a different lender) which in turn had been use to refinance an original loan (from a third lender). It was taken as a matter of fact that Mr Lewis had used a maximum of 50% of the original for business purposes and, therefore, it had not been used “wholly or predominantly for the purposes of a business” carried on by him (and, therefore, was as a matter of fact a regulated mortgage contract as the exemption under Article 61A(1)(c) of the RAO. However, the Court found that PBL had no way of knowing this and that Mr Lewis had made repeated representations that he would use the loan PBL made for business purposes and, therefore, the loan was unregulated and not a regulated mortgage contract.
In the alternative, the Court also found that if the PBL loan�was a regulated mortgage contract, it would still have been just and equitable for PBL to enforce the loan due to the repeated representations made by Mr Lewis.
Following on from these findings, and taking into account Mr Lewis history of defaulting on previous lending the interest rate charged by PBL was not an unenforceable penalty.
Lastly, it followed that the relationship between PBL and Mr Lewis could not be said to be unfair for the purposes of Sections 140A-C of the Consumer Credit Act 1974.
Stephen WilsonIndividuals sentenced to combined 12 years imprisonment for crypto fraud
Raymondip Bedi and Patrick Mavanga have been sentenced to a combined 12 years imprisonment for their involvement in a �1.5m crypto fraud conducted between February 2017 and June 2019, involving them cold calling victims to sell them fake investments in crypto.
Bedi was sentenced to 5 years and 4 months, while Mavanga received 6 years and 6 months.
The sentencing follows convictions achieved by the FCA late in 2024. Confiscation proceedings aiming to recover the proceeds from the fraud are ongoing.
PRA writes to CROs on BPA transaction termination rights
The PRA has written to CROs of life insurers to set out its views on the potential risks that stem from using solvency-triggered termination rights clauses in bulk purchase annuity transactions. The letter follows a...
FCA updates fee rate movement chart
The FCA has published a chart that clearly explains changes to fee rates for the 2025/6 fee year and the reasons for the change. The FCA’s annual funding requirement has increased by 3.8%. The chart explains why some...
FCA consults on SI regime for bonds and derivatives
The FCA is consulting on the future of the SI regime for bonds and derivatives in light to the removal of pre-trade transparency from their obligations. It wants to put new rules in place at the end of the year so it...
Michael LewisFCA launches beta testing of new website
The FCA has launched a beta version of its new Handbook website, which it hopes will make navigation easier and also make it simpler to see what has changed over time.
APPG on Fair Banking publishes APP report
The All Party Parliamentary Group on Fair Banking has published its “blueprint” on how to beat APP fraud. The report looks at how the UK is responding to threats and the early impact of the mandatory reimbursement...
Innovate Finance reports on AI opportunities in financial services
Innovate Finance has published a report on AI opportunities in financial services. A BoE survey recently showed that 75% of firms are using AI, with 10% planning to adopt it in the next 3 years. In terms of benefits for...
PRA updates capital buffers framework
The PRA has issued its final policy�amending the UK capital buffers framework, which includes streamlining of policy materials to enhance usability and clarity.
The changes to the framework have been implemented as proposed, and include:
statement of policy on the PRA�s approach to identifying global systemically important institutions (G-SIIs) and setting G-SII buffers;
amendments to SoP � the PRA�s approach to identifying other systemically important institutions (O-SIIs);
amendments to SoP � the PRA�s approach to the implementation of the O-SII buffer;
reporting instructions for the purpose of identifying and assigning GSII buffer rates;
PRA Standards Instrument: The Technical Standards (specification of the methodology for the identification of Global Systemically Important Institutions) Instrument 2025; and
PRA Rulebook: CRR firms: capital buffers (consequential amendments) instrument 2025.
The updated framework will come into effect on 31 July 2025.
Committee launches inquiry into growth of private markets
The Financial Services Regulation Committee has launched an inquiry into the growth of private markets in the UK, following regulatory capital and liquidity reforms introduced after the global financial crisis in 2008...
FCA and Treasury consult on ancillary activities exemption
HM Treasury is consulting on changes to the current UK secondary legislation setting the tests that firms must meet to use the “ancillary activities” exemption when they trade in commodity derivatives and emissions allowances.� As part of the Wholesale Markets Review, it said it would replace the current test with a new, simpler, version. It is now legislating to give the FCA powers to put in place a replacement test. The Order would amend the RAO and other statutory instruments in respect of the definition of “investment firm” and will provide that firms can use the exemption where the relevant business is ancillary to its main business, or is below an annual threshold that the FCA will set.
The FCA is in turn consulting on its proposals to set out, simply, how firms can work out whether they can benefit from the exemption. It proposes 3 separate and independent tests, and a firm will be able to use the exemption if it meets any one of them. It hopes the proposals will have the advantage of simplicity while having minimal impact on costs for firms, given the methods they already use to calculate the application of the exemption under the current regime.
Comments on both the draft legislation and the FCA consultation are due by 28 August. The changes will take effect from 1 January 2027.
BoE updates on digitalisation of finance
Sasha Mills has spoken on how the BoE is building a digital financial system for the UK. She considered the importance of trust in the markets, and the need for innovation to work alongside the existing system. She...
FOS complaints double in 2024/25
The FOS has published its complaints data for 2024/25, which shows that over 305,000 complaints were received – this is a 54% increase on the number received in 2023/24, and the highest yearly total of complaints...
FCA finalises non-financial misconduct rules extension and consults on guidance
The FCA has finalised new rules amending the scope of COCON to extend the existing non-financial misconduct (NFM) rules for banks to non-banks. Currently, COCON applies primarily, in respect of non-banks, to conduct forming part of the firm’s SMCR financial activities.
The FCA is also consulting on additional guidance in COCON and FIT. The draft guidance contains:
detail on the scope of COCON, including:
the boundary between work and private life;
when conduct is outside of a firm’s SMCR financial activities; and
when NFM may be out of scope in a non-bank;
factors to consider when determining whether NFM breaches the conduct rules;
examples of reasonable steps for managers to protect staff; and
explanatory material on how various types of conduct, including NFM, are relevant to FIT.
The consultation closes on 10 September 2025 and the made new rules amending the scope of COCON take effect from 1 September 2026, both in line with the conduct breach reporting period and to allow the FCA time to finalise any guidance it might want to make. The changes to COCON will not apply retrospectively, so will not require firms to do any retrospective analysis of whether they have incorrectly determined a rule breach in the past.� The FCA notes in its feedback that if non-banks had not appreciated the restricted scope of COCON and have disciplined an employee for conduct that they thought was a COCON rule breach, they should both update their past breach notifications and ensure they do not include any such breach in Question F of the regulatory reference form – although it may still be relevant under Question G.
The FCA has chosen not to take forward guidance on the relevance of NFM and discriminatory practices in firms to its assessment of their suitability to undertake regulatory activities (in COND), and guidance to remind firms that they may need to disclose NFM at work or in private life in a regulatory reference (in SYSC) – it believes its existing guidance on this point is sufficient.
BoE gives update on synchronised settlement plans
In light of BoE’s renewed RTGS service which went live on 28 April 2025, Victoria Cleland – Executive Director for Payments – has delivered a speech on synchronised settlement plans and initiatives in...
PRA hosts Future Banking Data roundtable
The PRA has hosted a roundtable with CFOs at large systemic firms to discuss the Future Banking Data project, which focuses on opportunities to develop and implement a long-term reporting approach for firms which is...
FCA speaks on harnessing AI and technology
Jessica Rusu has spoken on how the FCA plans to harness AI and tech to deliver its strategic priorities. It says that proper use can help it deliver on all 4 pillars, including helping firms to get new customers and...
FCA finalises 2025/6 fees
The FCA has finalised its fees and levies for 2025/26. Changes include: FCA’s introduction of a new CC$ category for motor vehicle lending with discretionary commission arrangements for firms that entered into at...
Tribunal upholds bans
The Upper Tribunal has upheld the FCA’s decision to fine and ban 3 individuals who engaged in market manipulation while working at Mizuho International PLC.
FCA Smaller Business Practitioner Panel responds to FOS consultation on compensation interest
The FCA Smaller Business Practitioner Panel has published its response to the FOS consultation on the calculation of interest firms must pay on compensation awards. The Panel supports the proposal to adopt a tracker...
Treasury makes recommendations for Women in Finance Charter signatories
HM Treasury has published a report on the progress of the Women in Finance Charter signatories, and how they can accelerate. On average, signatories increased female representation in senior management to 36% in 2024...
FCA publishes targeted support proposals for investments and pensions
The FCA is consulting on how to provide targeted support to consumers in pensions and retail investments. The paper follows several announcements of the FCA’s desire to see people invest with more confidence in...
FCDO publishes sanctions guidance for non-UK businesses
The Foreign, Commonwealth and Development Office (FCDO) has published guidance on UK sanctions for non-UK businesses. The guidance concerns sanctions targetting Russia, and aims to assist businesses in third countries...
PRA publishes 2025/26 fees
The PRA has published details of its fees for 2025/26.
The Total Funding Requirement (TFR) will be �350.2m, 0.8% lower than the 2024/25 TFR of �353m.
The Annual Funding Requirement (AFR) for 2025/26 is �336.4m, up �5.1m from 2024/25 AFR of �331.3 million, and �7.7m higher than that proposed due to the PRA receiving an increased allocation of the BoE�s wider investment portfolio and central support costs, partially offset by a decrease in the pensions provision.
FCA removes reporting and notification requirements
The FCA has published its final policy on removing specified reporting and notification requirements: FSA039 – Client money and client assets; RMA-F – Section F of the Retail Mediation Activities Return...
BoE publishes IEO evaluation of horizon scanning
The BoE has published the results of the Independent Evaluation Office’s evaluation of whether it uses horizon scanning effectively to inform decision making. The evaluation was commissioned by the BoE Court of...
PRA publishes results of 2024 firm feedback survey
The PRA has published the results of its annual feedback survey. Overall, the PRA scored higher in most topics than in 2023, with the most positive scores being given for the effectiveness of the relationship with the...
FCA secures guilty plea in fraud case
The FCA has secured a guilty plea from John Burford in a £1m investment fraud case. As sole director of Financial Trading Strategies Limited, Mr Burford had promoted a paid-for subscription service offering daily trade...
FCA publishes latest Handbook Notice
The FCA has published its latest Handbook Notice, which includes amendments relating to: the updated Enforcement Guide (now ENFG), and consequential amendments throughout the Handbook; the introduction of the PISCES...
Claims management law firm loses strike out application
Vanquis Bank Limited brought a case against TMS Legal Limited for causing loss by unlawful means. TMS Legal Limited is a “no win no fee” claims manager which has helped many complainants make a complaint to...
Tribunal backs Staley ban
The Upper Tribunal has upheld the FCA’s decision to ban Jes Staley from holding any senior management role in the financial services industry. It did however reduce the financial penalty in response to...
FCA to “improve” Handbook website
The FCA plans to launch a newlook Handbook website, which it says will be easier to navigate than the current version. Other features will include the ability to compare different versions of the text so it is easier to...
PSR consults on removing LINK competitive procurement requirement
The PSR has published a consultation on revoking Specific Direction 4, which requires the operator of the LINK payment system to undertake a competitive procurement for the infrastructure required to run it every 10...
FCA finds gaps in payments and e-money risk management and wind-down planning
The FCA has published the findings of its multi-firm review on enterprise and liquidity risk management and wind-down planning at e-money and payments firms. Of the 14 firms reviewed, the FCA said none fully met its...
FCA speaks on future of UK financial market
Nikhil Rathi – FCA Chief Executive – has delivered a speech on the future of the UK financial market at TheCityUK’s annual conference. The speech highlighted the UK’s position as a leading...
PRA publishes annual reports
The PRA has published its annual report for 2024/25, and a second report on its secondary competitiveness and growth objective. The annual report outlines the PRA’s achievements in advancing its statutory...
BoE speaks on RTGS 2 and innovation
Victoria Cleland – BoE Executive Director of Payments – has delivered a speech at the UK Finance Digital Innovation Summit on the success of the renewed Real Time Gross Settlement (RTGS) service, and ongoing...
UK-US Financial Regulatory Working Group publish joint statement
HM Treasury and the US Treasury – forming the UK-US Financial Regulatory Working Group – have published a joint statement outlining discussion points from their June meeting. The meeting emphasised ongoing...
FCA seeks views on future of the mortgage market
The FCA is continuing its mortgage rule review with a discussion paper on the future of the mortgage market, following a call for evidence on the interest rate ‘stress test’ rule and consultation on...
BoE launches DLT innovation challenge
The BoE has launched a distributed ledger technology (DLT) innovation challenge in collaboration with the Bank for International Settlements Innovation Hub London Centre. The challenge aims to engage with the private...
Regulators revise MoU on payments cooperation
The FCA, PRA, BoE and PSR have signed a memorandum of understanding on cooperating and coordinating their functions in relation to UK payments. Since the last review in December 2024, the regulators found that...
FCA publishes consumer guidance on recurring card payments
The FCA has published a webpage aimed at consumers, providing details of their rights when agreeing to a recurring card payment (or continuous payment authority) and how to deal with fees incurred after cancellation...
FCA publishes guidance on notifying the regulators
The FCA has published a webpage setting out when and how to notify it or the PRA about certain events. FCA-supervised firms are encouraged to use the notification form in SUP15, and dual-regulated firms are encouraged...
PRA consults on rule changes allowing Credit Unions to invest in service organisations
The PRA has published a consultation paper setting out proposals for changes to make it clear that Credit Unions can invest in Credit Union Service Organisations, subject to guard rails. In support of the...
BoE renews commitment to FX Global Code
The BoE has renewed its Statement of Commitment to the FX Global Code, based on the revised code dated December 2024. The Code sets out good practice in the FX market, and in signing the renewed statement, the BoE...
FCA secures insider dealing and money laundering convictions
The FCA has secured convictions against Redinel Korfuzi and his sister Oerta Korfuzi for insider dealing and money laundering offences from which they had earned over �1m.
Redinel Korfuzi was a research analyst at an asset management firm, and between December 2019 and March 2021 conspired with his sister to use confidential price-sensitive information to deal in the shares of at least 13 publicly traded companies ahead of market announcements. The relevant trades were executed using contracts for difference (CFDs), and were detected by the FCA’s market monitoring system, despite arrangements which were designed to obfuscate Korfuzi’s involvement.
During the relevant period, the Korfuzis had also received cash derived from the proceeds of crime totalling �198,210. The FCA plans to apply for confiscation orders in order to recover these monies.
Consumer Panel responds on FCA mortgage rule plans
The Financial Services Consumer Panel has some concerns about the FCA’s proposals to simplify mortgage regulation and make it more flexible. It reminds the FCA that the 2007/8 housing market collapse was in part...
New guidance on quantum-safe cryptographic practices
The Cross Market Operational Resilience Group has published guidance to help the financial sector transition towards quantum-safe cryptographic practices as institutions move to post-quantum cryptography. PQC refers to...
Caroline ChurchillInnovate Finance queries FCA proposals on contactless limits
Innovate Finance has responded to the FCA call for input on contactless limits. It queries whether the proposals really do align with economic growth objectives. It cites the crucial need for regulatory focus on SCA and...
OFSI publishes threat dashboard for art and high value goods sectors
OFSI has published a new set of� threat assessments �to help art market participants and high value goods dealers comply with financial sanctions requirements.
The guidance notes that there are numerous designated persons across many sanctions regimes who are high-net-worth individuals with footprints and assets in the UK, who may seek to use these sectors to buy and sell relevant assets – meaning that businesses who deal with them risk breaching sanctions restrictions if they are not alive to the risks and apply for licences where needed.
Alongside other entities within the AML regulated sector, these businesses are additionally subject to OFSI reporting requirements.
On the whole, OFSI says it is highly likely that high value goods owned by designated persons in the UK have not been reported to OFSI and it is likely that Russian designated persons and their enablers have dealt with goods in the UK in breach of asset freezes. It is also concerned that it has received a high number of suspected breach reports about high value goods submitted by other firms, such as financial services providers and legal firms – which it says emphasises that HVG dealers need to ensure they comply with their new reporting obligations now.
The guidance also reminds firms that where they are reporting to OFSI they should also consider whether they need to make a SAR to the NCA – again, it believes the sector is under-reporting based on the number of registrations of firms in the sector on the NCA SAR Portal
Finally, the guidance sets out some examples of what should be clear red flags of potential sanctions (and AML) issues and provides a couple of case studies, including a recent CPS report of an art dealer jailed for failing to report under Terrorism Act obligations his dealings with a suspected terrorist, who was also sanctioned by the US Government.
PSR publishes consumer payments research report
The PSR has published its 2024-25 Consumer Research report, which aimed to understand the influences behind consumer payment choices, how consumers behaved in different circumstances, and what they required of their payments systems.
Key findings included:
Payment behaviours are guided by context and rooted in habit;
Consumers are largely satisfied with payment systems and feel that payments are working well:
95% of consumers agree that payment systems in the UK are working well;
92% say that they can make and receive payments in a timely manner; and
87% feel their money is secure when they make payments in the UK;
However, 41% worried about the possibility of fraud (a particular concern for financially constrained consumers) and 39% experiencing limited choice in payments;
Consumers are confident about prioritising different needs for different payments:
Ease of use is consumers� top priority for lower value payment types, closely followed by speed;
Protection and security are the top priorities for higher value payments, with 42% of consumers preferring credit cards for higher value items; and
For recurring payments, reliability was key: 74% of consumers preferred to use direct debits or standing orders for their utility bills, and about two-thirds for rent or mortgages and entertainment subscriptions;
Contactless card payments remain the most frequently used payment type, with younger consumers significantly more likely to use mobile wallets regularly. A third of customers said they used contactless payments more than they did last year due to convenience, and they trust them more than they did previously; and
The majority of consumers felt positive and reassured when informed about the PSR�s recently introduced APP fraud reimbursement policy.
FCA speaks on balance
Emily Shepperd has spoken on the balance the FCA has been striving to get in its efforts to support the financial services sector, and how it has now a focus of 4 key areas as opposed to the 13 it had a few years ago...
FCA publishes findings of research competition on growth and competitiveness
The FCA has published the findings of the winners of its inaugural economic research competition on growth, competitiveness and regulation in UK financial services. The competition involved funding 3-month long projects, with researchers awarded up to �30,000.
The successful projects were:
What factors affect the demand for finance and longevity of newly listed firms? – University of Birmingham
Tail risk and consumer protection: implications for growth – University College London
Improving productivity measurement in the UK financial services sector – London School of Economics
Measuring transmission risk in UK financial services – Fathom Consulting
International competitiveness in the UK financial services sector – University of Edinburgh
UK financial services � a data-driven overview for the FCA – Beauhurst
PRA speaks on balancing innovation with regulation
David Bailey of the PRA has spoken on how it is working to help foster innovation in the UK’s banking and insurance sectors. Externally, its efforts to date have focussed on reducing the regulatory burden for firms, particularly so far in relation to insurance reporting and its current work on bank remuneration requirements. It has now embedded its secondary objective into the way it works, which has resulted in immediate policy decisions in areas such as Basel 3.1, where it will take the opportunity of the need to implement international standards to tailor its rules to reflect UK-specific circumstances. It now also has both a new bank and new insurer start up unit, run jointly with the FCA.
The PRA also needs to get the balance right between on the one hand setting lengthy and detailed expectations and on the other limiting itself just to high level principles.� The solution is probably a middle ground, but an approach that needn’t be the same for each issue.
FCA responds to enforcement policy criticism
The House of Lords Financial Services Regulation Committee has published the FCA’s response to its report on the contentious enforcement proposals. Of course, the content has largely been superseded by the FCA...
Tribunal upholds FCA decision on Listing Rule breach
The Upper Tribunal has upheld the FCA’s decision to fine the former CEO and CFO of Metro Bank for being knowingly concerned in a breach of the Listing Rules, but thought the level of fines should be slightly reduced, so the individuals have been fined around �167,000 and �100,000 respectively. The FCA had previously fined the bank over �10 million.
Data (Use and Access) Bill: now agreed
The Data (Use and Access) Bill (DUA Bill) has been agreed upon and is now awaiting Royal Assent. This significant milestone follows a lengthy and complex journey through Parliament, marked by debates and amendments, particularly in the latter stages around the issue of whether the DUA Bill should cover transparency on AI models using copyrighted works to train the models (a topical but somewhat tangential issue to the core subjects covered in the Bill).� This led to a “ping pong” between the Lords and Commons where we saw a number of passionate debates on the topic of transparency. Baroness Kidron, speaking on behalf of creatives in the Lords, talked about the UK Government cosying up to tech companies. She said she has spoken to AI academics and tech companies and one such said to her “of course we prefer it for free, but if you don’t protect your IP, we will take it just like we did your high street”. Baroness Jones of Whitchurch, the Under Secretary of State for DSIT, stated that the Government will soon work on more comprehensive AI legislation. She emphasized the need to await the outcome of the economic impact assessment and the report on AI and copyright to determine what further actions, including legislation, might be necessary. After a few weeks of intense debates, where the tension between the rights of creators and the interests of the UK tech industry was evident, the Lords eventually conceded on the issue of transparency on 11 June 2025 (at least in terms of the DUA Bill).
The DUA Bill aims to harness the power of data to drive economic growth, and make it easier for businesses to use technology while maintaining high standards of data protection.� The DUA Bill will introduce new smart data schemes, establish digital verification services, create a national underground asset register, and simplify the data protection regime in the UK (though less extensively than previously proposed under the last Government). The provisions in the DUA Bill on Smart Data will support open banking in the UK and extend its benefits to an open finance scheme.�Additionally, the DUA Bill proposes changes to the UK GDPR and PECR (the latter governing direct marketing and the use of cookies and similar technology), including the introduction of a new lawful ground of “recognised legitimate interests,” the removal of consent requirements for non-intrusive cookies, the widening of grounds for solely automated decisions, the simplification of scientific research provisions, clarifications on dealing with subject access requests, changes to rules on data exports, and changes to the structure of the Information Commissioner’s Office (ICO).
So what’s next for the DUA Bill? While the commencement is typically 2 months after Royal Assent for Bills, the DUA Bill will take longer. Detailed discussions on secondary legislation will be necessary. Within the first two months, only minor clarifications will be made; however, substantive changes to data protection provisions and ICO governance are expected to take 6 to 12 months. Meanwhile, the European Commission is in the process of evaluating the adequacy of the new data protection regime in the UK to decide if it will continue to provide adequate protection for data flowing from the EU to the UK without additional regulatory protections being required. Businesses and stakeholders should prepare for the upcoming changes and stay informed about the progress of the DUA Bill as it moves towards implementation.
Please get in touch with me (Sheilah) or Victoria Ferguson if you’d like any more information.
Sheilah MackieTreasury U-turn on BNPL regulation for domestic premises suppliers
After holding fast for so long over its decision not to exempt domestic premises suppliers from the need for authorisation under the cut-back BNPL exemption, the Government has now been persuaded to exempt them after...
HM Treasury makes wholesale cash oversight orders
HM Treasury has confirmed which firms operating in the wholesale cash distribution system have been recognised under Part 5A of the Banking Act, which gives it the power to specify persons involved in wholesale cash...
FATF updates on high risk jurisdictions and cross-border payments
At the joint FATF-MONEYVAL plenary meeting last week: the list of jurisdictions subject to increased monitoring was updated so that Bolivia and the BVI were added, and Croatia, Mali and Tanzania removed; the meeting...
Changes to payment services agreement termination rules agreed
The Payment Services and Payment Accounts (Contract Termination)(Amendment) Regulations 2025 have been made and will come into force on 28 April 2026. We reported on the draft Regulations when they were laid before...
FCA releases statement on commitment to growth
The FCA has published a statement on its commitment to growth, highlighting measures such as: making it easier for companies to list; setting out a roadmap for crypto regulation; reimagining financial advice and...
Committee report finds competitiveness and growth objective failures
A report from the House of Lords Financial Services Regulation Committee has concluded that the FCA and PRA’s secondary international competitiveness and growth objective is being held back by a culture of risk...
FCA cancels SPI permission
The FCA has cancelled the permission of a small payment institution which did not in fact start providing payment services and failed to submit regulatory returns. Transfer Now Ltd was registered in January 2019 and...
SFO gets investment for economic crime
The Government will give the SFO more funding as part of the Spending Review. The SFO will use it to strengthen its intelligence and information gathering work in relation to economic crime.
FCA launches investment advice assessment tool
The FCA has published a new Investment Advice Assessment Tool to help firms understand how it assesses suitability of investment advice and customer disclosures. The tool does not apply to retirement income or defined...
Practitioner Panel expresses concerns over CCI proposals
The FCA Practitioner Panel has expressed concerns around the FCA’s proposals on Consumer Composite Investments, following the regulator’s consultation covering changes to cost information and rules for the...
FCA sets out good practice for retirement income advice
The FCA has published findings from its review of advice consumers receive on meeting their income needs in retirement. In 2023, the FCA reviewed a sample of 28 firms, including a desk-based review of firms’...
FCA appoints Deputy CEO
Sarah Pritchard is the new FCA deputy chief executive – having already lead FCA’s supervision, policy and competition division, then its markets function and most recently its consumers and competition arm...
FCA finalises PISCES sandbox arrangements
The FCA has made the final rules that will allow the new PISCES system to start operating through a sandbox. The sandbox is open from 10 June, and shares are likely to start being traded later this year, with the FCA looking to move to a permanent regime by 2030.
As a reminder, institutional investors, HNWIs, sophisticated investors and employees of participating companies will� have access to PISCES, and the legislative framework, confirmed by HM Treasury in May, will require that they receive information on the risks involved in making investments.
The FCA has now published its policy and guidance for firms wanting to run a PISCES platform.� Its new rules will include obligations on operators for disclosure arrangements, organising and running trading events and market manipulation and oversight, and are in a new sourcebook, the Pisces Sourcebook (PS). The sourcebook also sets out the process for application, and how the FCA will decide on applications.
Court of Appeal says capital part of secured debt is not “moratorium debt” for Breathing Space purposes
The Court of Appeal has confirmed that the capital part of a secured debt does not form part of a “moratorium debt” for the purpose of the Debt Respite Scheme (Breathing Space Moratorium and Mental Health...
Luke Holmes
Karen Plumbley-JonesEmployment cases update – May 2025
Our case law update this month includes the Supreme Court’s landmark ruling in For Women Scotland Ltd v The Scottish Ministers, which clarified the interpretation of “man”, “woman” and “sex” for the purposes of the Equality Act 2010.� In Sullivan v Isle of Wight Council, the Court of Appeal looked at whether job applicants could claim whistleblowing protections.� Gourlay v West Dunbartonshire Council dealt with the reduction of compensation in the context of an unfair dismissal, victimisation and disability discrimination claim and in Madu v Loughborough College, the issue was the correct level of a costs order�made against a claimant.
For Women Scotland Ltd v The Scottish Ministers
A Scottish women’s rights group appealed against a decision that upheld the dismissal of its petition for judicial review of statutory guidance implemented under the Gender Representation on Public Boards (Scotland) Act 2018. The guidance stated that “woman” in that Act had the meaning under the Equality Act 2010 (EqA 2010) and that in the Gender Recognition Act 2004 (GRA 2004), where a full gender recognition certificate (GRC) had been issued to a person that their acquired gender was female or male, the person’s sex was that of a woman or a man respectively. The group argued that the 2018 Act purported to legislate on matters outside of the Scottish Parliament’s devolved competence.
The Supreme Court (SC) concluded that the terms “man”, “woman” and “sex” in the EqA 2010 refer to a person’s biological sex. �Although Section 9(1) GRA 2004 provides that a trans person with a GRC is entitled to have their acquired gender recognised for all purposes, Section 9(3) provides that this is subject to provision made by any other enactment or any subordinate legislation.� The SC held that the EqA 2010 is inconsistent with Section 9(1) and so Section 9(3) applied.� The SC emphasised that this interpretation does not remove protection from trans people, with or without a GRC. Trans people are protected from discrimination on the ground of gender reassignment and are also able to claim direct discrimination, indirect discrimination and harassment on the ground of perception or association with their acquired gender.
Sullivan v Isle of Wight Council [2025] EWCA Civ 379
Miss Sullivan had unsuccessfully applied for posts with the council. �She complained to the council and also later wrote to her MP detailing things that she said had occurred at the interviews and complaining about the activities of a charitable trust (of which one of the trustees was a member of the interviewing panel). �The council found her complaint to be unsubstantiated and did not offer her a further review. �Miss Sullivan subsequently brought a whistleblowing claim against the council, alleging that she had suffered a detriment as a result of the protected disclosure she had made about its employee’s alleged involvement in a trust with financial irregularities. �She accepted that she was not a worker within the meaning of the Employment Rights Act 1996 or an applicant for a post with an NHS employer, which would ordinally mean that she was not entitled to whistleblowing protection. �However, she argued that the legislation was incompatible with Article 14 of the European Convention on Human Rights, in so far as it protected workers and applicants for NHS posts but not job applicants generally.
The Court of Appeal held that being a job applicant is capable of constituting some “other status” under Article 14 but that an external job applicant is not in a ‘materially analogous’ position to internal applicants or applicants for NHS posts (who are protected by law).� Any difference in treatment is objectively justified because the legislation pursues a legitimate aim and the means adopted to achieve it are appropriate and proportionate.� Miss Sullivan had also not suffered any difference in treatment as a job applicant because her complaint to the council had been made as a member of the public and was not connected with possible employment.
Mr Brian Gourlay v West Dunbartonshire Council [2025] EAT 29
Mr Gourlay had multiple sclerosis and diabetes. �He was dismissed in 2015 for gross misconduct and brought claims for unfair dismissal, victimisation and disability discrimination. �It was agreed by the parties that he had developed a psychiatric illness by the date of his dismissal. �Mr Gourlay argued that his psychiatric illness was caused by the employer’s discrimination, and the employment tribunal (ET) accepted evidence that the employer’s failure to make reasonable adjustments had precipitated his illness and that he was permanently unfit for work. �The ET reduced Mr Gourlay’s past and future wage and pension loss to reflect the possibility that he would have sought or obtained ill health retirement on grounds unrelated to his psychiatric illness or that his employment would have terminated in 2017 in any event by a mutually agreed termination or by an irretrievable breakdown in working relationships.
Mr Gourlay appealed. �The Employment Appeal Tribunal�held that the ET was wrong to reduce his discrimination compensation, as the discriminatory dismissal had caused his permanent incapacity for work and the purpose of compensation was to put the employee in the position he would have been in had the discrimination not taken place. �A finding that his employment might have later ended lawfully if the dismissal had not occurred was based on speculation and did not justify a reduction in his compensation. �A reduction would only be appropriate if a lawful dismissal would also have caused him to be unable to work. �The case was remitted to a fresh ET to re-assess compensation.
Mr A E Madu v Loughborough College [2025] EAT 52
Mr Madu brought a claim for race discrimination against the college after failing to secure a part-time lecturer�role. �He was initially a litigant in person and then obtained legal representation.� His claim failed and the college applied for costs. �The ET concluded that Mr Madu should have appreciated from the outset that his claim had no reasonable prospects of success and awarded �20,000 in costs against him. He appealed and the EAT overturned the costs order. The ET had made assumptions about what advice Mr Madu had received from his solicitor, which was protected by legal professional privilege. �It was therefore wrong to infer that he must have been advised to discontinue his claim. �The ET had also failed to consider the difficulties claimants face in assessing the prospects of success in discrimination claims before the hearing, particularly when they act in person. �The claim was remitted to a fresh ET for reconsideration.
FCA to launch Supercharged AI sandbox
The FCA is launching a new, “supercharged” sandbox to give firms greater opportunity to experiment with AI. Its initiative that uses NVIDIA accelerated computing and enterprise software is open to all firms...
FCA consults on removing more returns and lifting ban on retail crypto ETN sales
FCA’s latest quarterly consultation proposes to: further streamline regulatory returns: it plans to: remove the GI pricing attestation and retail investment advisor complaints forms; reduce the frequency for...
FCA leads regulators in finfluencer crackdown
The FCA has joined forces with regulators across the globe to take action against finfluencers who are causing consumer harm by promoting financial products and services illegally. During last week’s week of...
FCA sets out key considerations for motor finance redress scheme
Although the FCA has not formally decided whether it will introduce a redress scheme in respect of motor finance commission arrangements, it has set out the key things it will need to consider if it were to do so. It...
CMA writes to NatWest on retail banking order breaches
The CMA has written to NatWest in relation to breaches by the bank of the Retail Banking Market Investigation Order. It found the bank: did not provide the required Monthly Maximum Charge information to customers in...
FOS consults on interest levels on compensation payments
The FOS is consulting on how it should be calculating the interest it orders firms to pay on compensation awards. It has been criticised for its current stance, which is to order businesses to pay 8% interest on top of any compensation for issues that have resulted in customers being deprived of money (pre-determination interest), or where they don’t pay the compensation on time (post-determination interest).
Feedback to the call for input on modernising the dispute resolution system generally has suggested it could be better if the interest rate were aligned with market conditions. So the FOS is now recommending changing the rate to the BoE base rate +1% for all new complaints, with the base rate calculated as an average rate over the period that the money way due until the date the redress payment is made.
The proposals will apply to pre-determination interest – the FOS gives an example of if an insurer undervalued the write off value of a car by �1,000, then the interest would be awarded from the date the complainant should have got that amount until the date they receive it, and to post-determination interest. But changing the approach to any interest that may be payable as part of a money award is not covered as these calculations have as their aim to ensure the complainant recovers their actual loss.
While the “tracker at average rate +1%” is the FOS’s preferred option, it also seeks views on whether it should
keep the current fixed rate
move to a lower fixed rate or
track base rate +1% but use the prevailing base rate at the time the complaint is determined.
It also seeks views on how to manage the transition to the new calculation. While its preferred option is to apply it to complaints it receives after the date it implements the new rate, the other options are:
apply to all existing cases as at the date of implementation
apply only where the act or omission complained about is after the implementation date or
apply only to customer losses that occur after the implementation date.
It also welcomes views on any challenges firms will face making the changes, when it might be appropriate not to apply interest and how often the FOS should review its approach to interest.
Consultation closes on 2 July.
Court rules on lenders on inquiry in joint borrower situations
The Supreme Court has allowed an appeal on whether a lender should have been on inquiry in a case of secured lending to joint borrowers.
In the case of Waller-Edwards v One Savings Bank Plc,� Ms Waller-Edwards was persuaded by her partner, Mr Bishop, to exchange her home and savings for a property he was building. At the time, the appellant was emotionally vulnerable but financially independent, as her home was free of mortgage and she had significant savings. Mr Bishop’s property was already subject to a charge. He then remortgaged 2 years later with the respondent bank, which believed the funds would buy another property that the couple would use as a buy-to-let and would pay off an existing mortgage debt.� It also required Mr Bishop to use the loan to pay off other existing debts, which included nearly �40,000 to pay off a car loan and a credit card. Mr Bishop actually used it to make a divorce payment and pay off the first charge on the property. The bank did not know this.
The relationship ended, and eventually the payments on the heavily mortgaged house in which Ms Waller-Edwards was then living fell behind and the bank started possession proceedings.
The appellant said that since she was a surety for part of the loan that would be used to pay off Mr Bishop’s debts, the bank should have been on inquiry that she may have been under undue influence to agree to the transaction, and it did not take steps to make sure she was aware of the liability she would be taking on. She said the remortgage transaction should be set aside as between her and the bank.
The County Court judge had agreed the appellant had entered into the transaction under undue influence but it, the High Court and the Court of Appeal all said the bank was not on inquiry because she was not a surety but instead a joint borrower. The Supreme Court disagreed. It said that where in any non-commercial hybrid transaction there is on the face of it more than a trivial element of borrowing that will discharge the debts of one borrower and therefore might not be to the other’s advantage a bank should view it as a “surety” transaction and therefore put on inquiry of the possibility of undue influence.� It said the Court of Appeal’s focus on a “fact and degree” test to establish whether the transaction was a surety transaction or a joint borrowing was wrong, as was it wrong to focus on the purpose for which the loan was used. The relevant question was whether one borrower takes on a legal liability for which they are not responsible for no personal gain. In this case, the appellant did take on such a liability.� So that meant the bank should have followed the “Etridge protocol” that required it to ensure Ms Waller-Edwards knew of the risks she was taking on.
FCA and ICO outline work on accelerating innovation
The FCA has outlined how it is working with the ICO to help firms use AI responsibly, while protecting consumers and encouraging innovation. The FCA and ICO see regulation as “a bridge, not a barrier”, and...
FCA publishes updated Enforcement Guide
Following considerable sector backlash over – and the FCA’s subsequent revision of – proposals to introduce increase transparency in enforcement with a ‘public interest’ test, the FCA has...
The new Scottish security regime – we’ve updated our guide
Under the Moveable Transactions (Scotland) Act 2023, major changes to how to create effective fixed security over certain types of assets located in Scotland (including Scottish shares and bank accounts) took effect on 1 April 2025.
Two new forms of fixed security over assets � a statutory pledge and an assignation of claims � introduce more streamlined ways of taking fixed security over certain assets, reduce the administrative burden, and allow fixed security to be created over current and future assets (including by certain individuals and corporate entities which can’t grant floating charges).
For current and potential deals, lenders/security agents should consider taking security over Scottish assets under the new regime (and for existing deals, whether there is scope under existing debt documents (for example, undertakings or further assurance provisions) to take advantage of the new regime to have a more robust Scottish security package).
We’ve updated our guide to the Act. Please contact [email protected] and/or [email protected] if you have any questions.
Chris McLauchlanGovernment completes exit from NatWest
Following almost 17 years of public ownership, the Government has completed its final sale of shares in NatWest Group.
The Government’s involvement with Natwest – formerly Royal Bank of Scotland, RBS – arose when it intervened during the financial crisis to prevent the bank’s collapse. During 2008 and 2009, it provided �45.5bn of funding to stabilise the bank, of which around �35bn has been returned to the Government via the share sales, dividends and fees. The Office for Budget Responsibility highlighted that this shortfall is far less than the economic harm that would have resulted from no intervention.
The exit from NatWest means that the Government has now concluded all banking sector interventions made during the financial crisis.
PRA publishes regulatory digest
The PRA has published its regulatory digest, summarising important developments delivered in May 2025. Key publications included: Consultation on Pillar 2A Phase 1 capital review Updates in respect of the PRA’s...
FCA welcomes statement from industry bodies supporting faster settlement for fund trades
The FCA has welcomed a joint statement from the Investment Association, Personal Investment Management and Financial Advice Association, and Alternative Investment Management Association, supporting faster settlement of...