The Financial Conduct Authority (FCA) cancelled the permissions of 197 regulated firms between 31 March 2021 and 31 March 2022, as it amped up its enforcement activity.
This was part of the FCA’s ‘use it or lose it’ strategy, which saw the regulator crack down on firms which were not using their permissions.
Since then, the Financial Services Act has enabled to FCA to cancel or vary a firm’s permissions without their consent and 28 days after a first warning.
Previously, the regulator had to wait 12 months before cancelling a firm’s permissions to carry out regulated activities if it had not used them.
According to the City regulator’s annual review, over the same period of time, firms or individuals who broke the FCA’s rules were fined over half a billion pounds.
Meanwhile, a tougher approvals process means that one in five applications were not authorised during the 21/22 financial year, up from one in 14 during the previous 12-month period.
These statistics were released to show the breadth of the FCA’s enforcement activity, as it doubles down on its remit to prevent and minimise consumer harm by cracking down on rogue firms.
The regulator will soon publish its new consumer duty, which will detail the ways in which regulated financial services firms should operate.
“Our new consumer duty will ensure all firms take account of the actual impact of their services and the suitability of their products for consumers,” said Nikhil Rathi, chief executive of the FCA.
“Requirements will address the need to support consumers in financial difficulty, ensure products are fair value and make it easier for consumers to switch from inadequate products.
“Favouring outcomes over tick-box compliance also supports competitiveness. Firms gain certainty about our expectations, including for products not yet launched and, with fewer anticipated rules changes, costs should fall.”
Source: P2P Finance News