UK regulatory update — issue 3: enhanced enforcement powers

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UK Regulatory Update — Issue 3: Enhanced Enforcement Powers - .PDF file.

The third issue of our step-by-step guides looks at the new and improved enforcement powers of the PRA and FCA. While going forward both regulators promise a focus on judgement led preventative action, the enhanced disciplinary powers will undoubtedly be used to keep up the pressure on the financial services sector. Taken together the new powers will support quicker and more aggressive intervention by the FCA and PRA.

In this issue we look at the key new rules, explore the implications around some of them and flag the new regulators’ proposed approach to enforcement.

The new powers include:

  • The ability to publish a warning notice, so bringing forward the point at which details of an enforcement action are made public and before a recipient has formally responded.
  • The ability for the FCA and PRA to impose ‘requirements’ on a firm’s permission at their own initiative with less process than a variation of permission currently requires.
  • The ability for the FCA or PRA to appoint their own s.166 skilled person at the expense of the firm, as opposed to this appointment being made by the firm. In this way the regulators will have more control over who is appointed and the scope of the appointment.
  • The ability for certain designated consumer bodies to make ‘super complaints’ to the FCA where they believe a feature or product in the market is significantly damaging the interests of a class of consumers. The FCA will have to investigate and publish a response within 90 days…

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