Improving our authorisation process
As part of improving our authorisation process, we’re updating the Firm Details form, which firms use to update their core details.
The updated forms strengthen the validation process for all existing fields, as well as verifying email addresses, phone numbers and postal addresses. We’re also improving guidance, navigation and accessibility.
Firms registered with Companies House must go to the Companies House website to ensure their details are correct as soon as possible. The new form will use the registered name, registered address, and financial year-end as the official record for your firm, where applicable.
Cost Benefit Analysis Panel
The Financial Services and Markets Act 2023 required us to establish and maintain a new Cost Benefit Analysis (CBA) Panel to give us and the Payment Systems Regulator advice on cost benefit analysis.
The Panel is expanding. If you currently work at an FCA-authorised firm, have experience in assessing regulation’s costs and benefits, and a background in economics and would like to apply please see the role description with details on how to apply.
Detecting and preventing money mules
We have published a review into how firms use the National Fraud Database (NFD), and a widely used commercially available money mule account detection tool, to prevent fraud and money muling.
Firms must prioritise the identification of money mule activity and help educate their customers about the consequences.
We have conducted a review of wholesale brokers' money laundering defences. The report is intended to help firms improve their systems, controls, risk awareness and training to guard against money laundering.
Our review identified key areas firms must improve to better protect against money laundering, including:
- Underestimating the risks of money laundering which firms are exposed to.
- Limited information-sharing between firms.
- Insufficient awareness of the money laundering through the markets suspicious activity reports glossary code.
First fine for transaction reporting failures under MiFIR
We have fined Infinox Capital Limited £99,200 for failing to submit 46,053 transaction reports which risked market abuse going undetected.
It is vital that firms submit accurate and timely transaction reports, and promptly bring any failures to our attention.
Our specialist teams constantly monitor market data in real time to track any signs of misconduct.
Redress Liabilities – the polluter pays
This month, we set out common polluting behaviours in the market and the importance of firms planning for redress liabilities. The pages highlight best practices for managing liabilities, including actions to take when encountering polluting behaviours.
We want polluters to pay for the liabilities they create, ensuring market confidence and a level playing field for firms. This allows businesses focused on good consumer outcomes and market integrity to compete fairly.
Firms are encouraged to read and understand the new web pages.
Cancelling your authorisation to avoid fees
If you submit your cancellation application to us before 31 March (or before the last day in February, if you're also regulated by the PRA), you won't have to pay the annual fee for the following financial year. If, however, your business continues to operate for 3 months beyond this deadline – ie past 30 June – then you'll have to pay the annual fee for the financial year.
We have more information about:
Open Banking next steps
The FCA and PSR have set out the next steps for open banking. Open banking is a UK success story with over 11.7 million active users and over 22.1 million open banking payments made monthly.
As part of the next steps to deliver variable recurring payments, Open Banking Limited will play a key role in establishing an independent central operator to coordinate how these payments are made. We thank industry for their continued support and engagement in the success of open banking so far. We will continue to work together constructively as we implement the next steps.
Reminder for principals: make sure you have compliant Professional Indemnity Insurance
Analysis of data from principal firms shows that some do not have adequate Professional Indemnity Insurance (PII).
Where PII is a requirement, principals must have a policy in place that meets our rules and covers the activities of current and former Appointed Representative (ARs) and Introducer ARs (such as MIPRU 3.2, IPRU-INV 13). The PII policy must not have any exclusions or excesses that unreasonably limit indemnity. Principals must also hold adequate financial resources, taking into account their ARs’ activities.
Financial Services Compensation Scheme (FSCS) levy
We have published CP25/1: our annual joint consultation with the PRA on the limit of total management expenses the Financial Services Compensation Scheme (FSCS) can levy on financial service firms for 2025/26.
This is relevant to all FCA and PRA authorised firms who fund the FSCS through levies.
The consultation closes on 7 February 2025. Please respond using the online form.
The FCA and PRA will consider the responses and resolve any issues raised. The final rules for the management expenses levy limit will be in place 1 April 2025.
Pilot Study into Bias in Natural Language Processing
We want to enable the safe and responsible use of AI in UK financial markets, driving growth, competitiveness and innovation in the sector. As part of our effort to deepen our understanding of AI and its potential impact on financial services, we are undertaking research in the area of AI bias.
As part of our AI research series, our latest publication explores bias in a natural language context. The research uncovers how biases in word embeddings could be identified and removed at source through current methodologies.
We hope that these notes are of interest to those who build models, financial firms, and consumer groups in understanding complex debates on building and implementing AI systems.
Financial crime fine
We fined Arian Financial LLP (Arian) £288,962.53 for failing to ensure it had effective systems and controls against financial crime.
The controls the firms we regulate have in place are an important line of defence against our financial system being abused for criminal ends.
This is the seventh case we have brought against cum-ex trading and withholding tax schemes.
FCA and Practitioner Panel joint survey launch
The next FCA and Practitioner Panel survey is being sent to all regulated firms so they can share their feedback on how we regulate the industry. We use the results to better understand issues affecting firms and to assess any necessary changes to our approach to help us be more innovative, assertive and adaptive.
The survey is carried out on our behalf by Verian (formerly known as Kantar Public), an independent social research organisation. Firms’ personal information will not be published or shared with us or the Panels.
FCA Leeds office expansion
Earlier this month, we opened additional floor space at our existing base in Leeds, increasing it by a further 5,000 square feet. First opened in 2022, our regional office in Leeds is now a base for over 300 employees, with around 100 more people expected to be welcomed into the additional space this year.
The expansion provides further opportunity for us to benefit from a broader talent pool, offering different perspectives and experiences, meaning we can better represent the communities we serve. Our website has the full story.
Participate in FCA website user testing
We’re always looking for firms to take part in remote user testing as we continue to review and improve our website (fca.org.uk).
We want to make sure that you can find what you’re looking for and it’s clear when information has been updated.
If you’re happy to help, please sign up via our online form and we’ll reach out to a number of firms when we’re ready to begin testing.
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