Financial services regulatory and risk
Back to Brexit – House of Lords EU Financial Affairs Committee recommendations on financial services after Brexit
The House of Lords EU Financial Affairs Committee has published recommendations on the financial services industry post-Brexit. The Committee recognised that this may not be a government priority due to COVID19, but EU negotiations and the future of the UK's financial services industry will be important issues in future months.
Read moreCOVID-19: key financial workers
The Financial Conduct Authority (FCA) has released guidance on steps financial services firms should take to help identify 'key workers'.
Read moreCOVID-19 forces POS and FOS office closures – what does it mean for complaints?
The COVID-19 outbreak (and the subsequent UK lockdown) continues to impact our daily lives and it seems the Financial Ombudsman Service (FOS) and The Pensions Ombudsman (POS) are not immune. With office closures announced, we look at the impact this will have on outstanding complaints and those yet to be made.
Read moreNew FCA signposting travel insurance rules
Earlier this month the FCA published a policy statement detailing new requirements aimed at helping consumers with pre-existing medical conditions (PEMCs) obtain travel insurance. The new requirements demonstrate the FCA's continuing focus on improving the treatment and protection of vulnerable consumers accessing insurance and other forms of financial services.
Read moreCOVID-19 – FCA's update for consumers
In the current unsettling time, in addition to publishing guidance for firms, the FCA is keen to maintain contact with consumers. The FCA wants to ensure consumers are being protected and therefore, is providing regular advice on the steps that consumers can take to stay aware of any potential impact on their finances.
Read moreCOVID-19: FCA's update for firms
The FCA's website may not be your first port of call to keep up-to-date on the COVID-19/coronavirus situation here in the UK, but it should be on your list. Why?, you may ask!
Read moreFOS warns consumers to ensure insurance applications correct
The Financial Ombudsman Service (FOS) has warned consumers of the risks in providing incorrect details in relation to insurance policies in a new insight report. The risks include policies being avoided due to misrepresentation or material non-disclosure or potentially facing a significant shortfall due to underinsurance.
Read moreThe FCA's key concerns for the pensions market in 2020
In its Sector Views published on 18 February 2020, the FCA has announced its strategic priorities for the pensions sector for this coming year. Key issues include transfer advice, which continues to be a supervision priority, and poor value products that lead to lower living standards in retirement.
Read moreHappy Birthday to the SIPP
This week marks the 30th anniversary of the first self invested personal pension (SIPP).
Read moreDefined Benefit pension transfers and SIPP FOS complaints on the rise
Official FOS figures from the end of 2019 show Defined Benefit pension transfers and SIPP complaints are on the rise although the percentage of these complaints upheld has dropped. How will the FOS respond in an area where we have seen a heavy CMC presence?
Read moreA new issue for SIPP providers?
Self invested personal pension providers are facing a new type of complaint brought in relation to investments made via investment managers – is this a potential area of risk for SIPPs or is this taking their obligations one step too far?
Read moreFCA sees SM&CR as catalyst and opportunity to transform culture in financial services
Its recent 'Dear CEO' letter, the FCA sets out its expectations on firms and Senior Managers in tackling non-financial misconduct. For some time the FCA has emphasised the importance of culture at firms causing financial conduct issues. In this recent letter, the FCA makes clear that non-financial misconduct will be a key focus for its supervision of firms and senior managers.
Read moreEmerging Risks: crypto-assets under international and domestic regulatory scrutiny
The latest in our emerging risks series of blogs discusses the long-running saga of cryptocurrency regulation. At an international level, the Financial Stability Board has been looking at the regulation of stablecoin. On the domestic front, the Financial Conduct Authority has published a consultation paper regarding the recovery of their costs for supervising cryptoasset businesses.
Read moreActuarial monitoring scheme announced
The Institute and Faculty of Actuaries (IFoA) has launched a new monitoring scheme, designed to improve the effectiveness of actuarial regulation, as well as make wide-spread improvements across the profession. The Actuarial Monitoring Scheme was created following a consultation by the IFoA.
Read moreEmerging Risks: Equity release products increasing, despite concerns over lack of understanding
Equity release products are becoming an increasingly popular option to home owners looking to release cash, especially with the over 65 population. However despite the increase in use and the encouragement of these products from the Equity Release Council, advisers need to tread with caution to ensure customers are aware of the potential pitfalls.
Read moreAbridged Advice and Workplace Pension Schemes - digging deeper into the FCA's Latest Pension Transfer Consultation Paper
Now that the dust has settled on the FCA's latest Consultation Paper on Pension Transfers (CP19/25), is there more to the regulator's proposals than first met the eye?
Read moreThe Senior Managers and Certification regime: The Final Countdown
With only a few months to go until the Senior Managers and Certification Regime (SMCR) is extended to apply to all sole-regulated firms, the FCA has released further near-final rules and produced a report on its findings as to how firms in the banking sector have embedded the regime since March 2016.
Read moreCourt of Appeal guidance on liability of financial advice networks for appointed representatives
In what circumstances is a financial advice network liable for the acts and omissions of its appointed representatives (ARs)? The Court of Appeal has today provided valuable guidance for those operating this business model. The decision will be welcomed by financial advice networks in confirming, in particular, that they are able to place restrictions on the business of ARs for which they have accepted responsibility.
Read moreTrends in FCA Enforcement: the Enforcement Annual Performance Report for 2018/2019
Read moreFCA announces new rules on peer-to-peer lending
The FCA has published its policy statement on peer-to-peer (P2P) lending following a lengthy public consultation into the crowdfunding industry in general. The policy statement introduces a large number of new rules for P2P platforms and includes restrictions on direct marketing to non-sophisticated / high net worth investors unless they are receiving regulated advice, and ensuring such investors do not place more than 10% of their investable capital in P2P platforms.
Read moreBrexit: A blessing or a curse for accountants?
A recent survey has indicated that the accountancy profession is well placed to accommodate the uncertainties surrounding Brexit.
Read moreNew pension transfer data – FCA's concerns remain
The FCA has published the results of data received from firms carrying out DB transfers and set out the next steps in its supervisory work.
Read moreFCA and PRA jointly fine bank for repeated outsourcing failings
R. Raphael & Sons PLC (Raphaels), one of the UK's oldest lenders, has been criticised and fined jointly by the FCA and PRA after it was found that the bank had failed to manage its outsourcing arrangements properly.
Read moreFinancial Reporting Council considers the test for "misconduct"
A recent Financial Reporting Council (FRC) Tribunal decision provides some welcomed clarity on the distinguishing features of misconduct and negligence for those in the accountancy profession.
Read moreAll bets are off for binary options
Following consultation, the Financial Conduct Authority (FCA) announced on 29 March 2019 that, as of 2 April 2019, the sale, marketing and distribution of binary options (including securitised binary options) to retail consumers will be prohibited indefinitely.
Read moreFCA promises "greater clarity" over Crypto regulation
The Financial Conduct Authority (FCA) has made further progress in relation to the regulation of cryptocurrencies such as bitcoin, in an attempt to tackle the growing market. The aim of regulation will be to provide greater clarity to both the industry and consumers.
Read morePension Transfers – FCA provides an end of year report
As the end of the calendar year approaches the FCA's recent publication indicated that the regulator remains concerned as to the suitability of pension transfer advice. If the FCA's recent review was an end of term school report this would be best summed up as "could do much better".
Read moreRegulation of cryptocurrencies inches ever closer
The long awaited regulation of cryptocurrencies has moved one step closer, with the Financial Conduct Authority (FCA) announcing plans to consult on regulation before the clock strikes twelve on 31 December 2018. The news comes after pressure for regulation has grown following a $15 billion crash.
Read moreThe Barclays Case – Criminal Corporate Liability
The UK Serious Fraud Office's (SFO) final attempt to prosecute Barclays in connection with Qatari loans ended on October 26 with the rejection of its High Court application to reinstate criminal charges against the bank.
Read moreAnti-money laundering legislation meets the art market
The art market is often described as the last unregulated market. Even if that is true, it is set to change in the next couple of years, with the market being brought firmly within the ambit of European Union anti-money laundering legislation.
Read moreHong Kong's Court of Final Appeal rules on fraudulent or deceptive conduct in share dealings
In another landmark case for the Securities and Futures Commission (SFC) in Hong Kong, the Court of Final Appeal has ruled on the ambit of section 300 of the Securities and Futures Ordinance (Cap. 571 – the Ordinance), and confirmed that it covers insider trading in shares listed outside Hong Kong.
Read moreCrypto Assets and ICOs as seen by the SMSG - Part 2
On 19 October 2018, the Securities and Markets Stakeholder Group (SMSG) published a report on initial coin offerings (ICOs) and crypto assets. The report is a useful one-stop shop for relevant definitions, classifications and statistics and we summarise the highlights in this two-part series.
Read moreInterest-only mortgages - the new PPI?
A new wave of complaints is hitting the mortgage market, concerning interest-only mortgages taken out before the financial crisis. Why is this happening and what should we look out for?
Read morePart three: food for thought – some key features of the SMCR
Having laid out the basic architecture under the SMCR, this final part of the series looks more closely at various elements of the new regime, which we consider particularly noteworthy and which give rise to specific issues to be addressed.
Read moreCrypto Assets and ICOs as seen by ESMA's SMSG
On 19 October 2018, ESMA's Securities and Markets Stakeholder Group (SMSG) published a report on initial coin offerings (ICOs) and crypto assets. The report is a useful one-stop shop for relevant definitions, classifications and statistics and we summarise the highlights in this two-part series.
Read morePart 2: What does the SMCR mean for me?
The new “Conduct Rules” are a minimum, basic standard of good personal conduct and behaviour applicable to all financial services personnel, and against which the FCA will hold individuals to account.
Read moreHong Kong's Securities and Futures Commission to target cryptocurrency exchanges
The outgoing chairman of Hong Kong’s Securities and Futures Commission (the “SFC”), Carlson Tong Ka-shing, has reportedly stated that the SFC is looking to extend its regulatory reach to Hong Kong’s cryptocurrency exchanges, which have so far been operating in a largely unregulated sphere.
Read morePart 1: What is the SMCR?
The Senior Managers & Certification Regime (“SMCR”) will replace the FCA’s existing approved persons regime and represents a paradigm shift in the financial services industry in the UK.
Read moreFCA proposes FOS award limit increase to £350,000
The FCA has announced plans for an increase in the current FOS compensation cap. Currently standing at £150,000, the changes would see the limit increase to £350,000, an increase of 133%. It is also proposed that the limit will further increase automatically each year in line with inflation.
Read moreWhat's next for the FCA after Brexit?
Brexit - you can rarely go a day without hearing this word. But what does it mean in real terms for financial professionals? The FCA has acknowledged that a looming Brexit will have implications for how the FCA works in the future and has begun to discuss its plans.
Read moreRelief for Skilled Persons as the Court of Appeal rules they are not amenable to judicial review
In what circumstances might skilled persons appointed under FSMA be subject to judicial review? The Court of Appeal recently explored the vulnerability of skilled persons to judicial review and dismissed an application for judicial review against KPMG, acting as a skilled person on behalf of Barclays Bank, as it found the framework in which KPMG operated was not sufficient to bring it into the public law arena.
Read moreSFC Disciplinary Action – Customer/Personal Data
On 20 September 2018, the Securities and Futures Commission (“SFC”) banned an individual named Ngo Wing Chun from re-entering the industry for 12 months (the “Decision”) for having taken the personal data of approximately 995 customers from his employer and emailed it to his personal email. The evidence showed that none of the information had been disclosed to any third parties.
Read moreESMA renews restrictions on CFDs and binary options
The European Securities and Markets Authority (ESMA) has decided to renew intervention measures, which restrict the sale of contracts for difference (CFDs) and binary options to retail investors, for a further three months.
Read moreTreasury Committee Calls for Cryptocurrencies to be Regulated by the FCA as a Matter of Urgency
The House of Commons' Treasury Committee published its report on Crypto-assets on 19 September 2018. The report strongly recommends that cryptocurrencies and ICOs be considered regulated activities in the UK as a matter of urgency. But realistically, when can we expect the crypto-market to be regulated in the UK?
Read morePension watchdogs launch joint advertising campaign to warn against scammer tactics
The Financial Conduct Authority and The Pensions Regulator have launched a joint TV advertising campaign to raise awareness about pension scams and the common tactics deployed by fraudsters.
Read moreTrustees of defined benefit schemes – are they on the hook for pension transfers? Yes says the Pension Ombudsman
The Pension Ombudsman has upheld a complaint against the trustees of a defined benefit scheme for failing to warn of the risks of a transfer to a pension liberation scheme. The Pension Ombudsman found that had the trustees provided documentation recommended under guidance from the Pension Regulator and identified and warned the member of certain hallmarks of a pension liberation scheme, the member would not have transferred his pension. The Pension Ombudsman has directed the trustees to reinstate the complainant's pension in the defined benefit scheme and pay £1,000 in distress and inconvenience.
Read moreEIOPA Report on Cyber Insurance raises awareness and understanding of cyber risk in the European market
The European Insurance and Occupational Pensions Authority ("EIOPA") has published a report "Understanding Cyber Insurance – A Structured Dialogue with Insurance Companies", which heralds its first attempt to enhance understanding of cyber risk with a focus on the European market.
Read moreNew rules for peer-to-peer lending announced by FCA
The popularity of peer-to-peer (P2P) lending has increased exponentially in recent years, with nearly £10 billion being transferred through such platforms in the past ten years. In an attempt to fix "increasingly complex business structures", the FCA has announced new plans for new rules for peer-to-peer (P2P) lending.
Read moreIs a "Duty of Care" required for financial services firms?
On 17 July 2018, the Financial Conduct Authority (FCA) released DP18/5 – its discussion paper on a duty of care and potential alternative approaches. In this article we summarise the discussion paper and then examine briefly whether a new duty is required.
Read moreAccountants, auditors and actuaries beware: the FRC continues to show its teeth, as its future stands in the balance
In widely publicised news, the Financial Reporting Council (FRC) continues to levy record high fines and has cast criticism on a number of firms. What appears to be an unforgiving stance taken by the regulator seems to come in the wake of the review into whether or not it should be disbanded, or folded into another regulatory organisation.
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