Category: FCA

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FCA consults on draft updated temporary guidance to motor finance and high cost credit firms dealing with customers needing COVID-19 related payment deferrals

Earlier today, on 3 July 2020, the UK Financial Conduct Authority issued a consultation on draft updated temporary guidance to motor finance and high-cost credit firms dealing with customers needing COVID-19 related payment deferrals.

There’s draft guidance for motor finance, for high-cost short-term credit and for rent-to-own, buy-now pay-later and pawnbroking agreements. There’s also a draft handbook instrument.

My one page summary is (and you can see a bigger version if you click on it):

If you want a pdf copy, please get in touch: russell.kelsall@TLTsolicitors.com.

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FCA publishes final report on the payment protection insurance complaints deadline

On 24 April 2020, the UK Financial Conduct Authority published its final report on the payment protection insurance (PPI) complaints deadline.

The report:

– says the FCA’s PPI campaign has been a success;

– states firms have paid over £38bn of redress to customers; and

– brings an end to the FCA’s project work on PPI (but it will continue to monitor how firms are dealing with complaints submitted before the 29 August 2019 deadline).

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FCA publishes new webpage setting out its expectations for wet-ink signatures in light of coronavirus (Covid-19) restrictions

On 20 April 2020, the UK Financial Conduct Authority published a new webpage setting out its expectations for wet-ink signatures in light of COVID-19 restrictions. The FCA makes it clear its rules do not require wet-ink signatures on agreements. However, firms need to make sure electronic signatures comply with the general law (see our earlier post on the Law Commission’s report on electronic signatures). The FCA reminds firms to consider the Principles for Businesses when using electronic signatures.

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FCA issues final notice to claims management company seeking authorisation

On 29 January 2020, the UK Financial Conduct Authority published a final notice given to FS Claims Limited (a firm applying for authorisation for claims management activity).

The FCA decided the application was incomplete and, given the failings to provide further information it had asked for, the FCA did not consider the applicant could meet the threshold conditions in the Financial Services and Markets Act 2000.

This is a clear indicator from the FCA that the application process for claims management companies will not be easy.

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Financial Conduct Authority imposes first fine on a claims management company

The UK Financial Conduct Authority (FCA) has published a final notice fining a claims management firm, Professional Personal Claims Limited (PPC), £70,000 for misleading information published on its website and in printed materials. 

In summary, PPC:

– had used the logo of five major banks which the FCA said was likely to mislead its customers into believing they were submitting claims directly to the banks; and

– was sending generic and factually identical complaints to the banks when evidence specific to each client should have been presented.

The FCA has also published a press release.

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FCA fines firm for TCF breaches

On 20 November 2019, the UK Financial Conduct Authority (the FCA) published a final notice imposing a fine of £1,867,900 on Henderson Investment Funds Limited for failing to treat customers fairly under Principle 6 of the FCA’s Principles for Businesses.

The FCA decided the firm failed to treat its customers fairly because, between November 2011 and August 2016, the firm ”significantly” reduced the level of active management for retail investors (but not for institutional investors) which led to retail investors being treated “substantially different”.

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Final notice given to Interest Free Loans Limited refusing its application for authorisation (and provides a useful insight of the FCA’s expectations when making an application)

The UK Financial Conduct Authority has published a final notice given on 10 July 2019 to Interest Free Loans Limited refusing its application for permission to (amongst other things) enter into a regulated credit agreement for high-cost short-term credit as lender.

The final notice gives a useful insight into the FCA’s approach when considering an application for authorisation for credit-related regulated activities. For example, it lists the documents sought from the applicant (see paragraph 22) and the kind of information the FCA expects to see in policy and procedure documents (see paragraph 28).

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FCA publishes its ‘Approach to Supervision’ and ‘Approach to Enforcement’

On 24 April 2019, the UK Financial Conduct Authority published its ‘Approach to Supervision’ and its ‘Approach to Enforcement’.

Both of these approach documents provide a helpful insight to firms on the FCA’s approach to both supervision and enforcement.

The FCA’s approach to enforcement gives the following insights:

– The “overriding principle in our approach to enforcement is a commitment to achieve fair and just outcomes in response to misconduct. Wrongdoers must be held to account and our rules and requirements must be obeyed”;

– “Not all breach’s of our rules or requirements constitute serious misconduct. Many breaches can be addressed and remedied elsewhere (and we expect them to be) without the need for enforcement action, especially where the error is technical or minor”;

– “Firms and individuals should not wait for an investigation to end before acting in a way they think is right”; and

– “We aim to make sure the sanction is sufficient to deter the firm or individual from re-offending and deter others from offending”.

The FCA’s approach to supervision also gives the following insights:

– “We expect firms and their employees to meet [our] standards and hold them to account when they fail to meet them”;

– The supervisory principles (a) are forward looking, (b) focus on strategy and business models, (c) focus on culture and governance, (d) focus on individual and firm accountability, (e) are proportionate and risk-based, (f) involve two-way communication, (g) are co-ordinated and (h) put right systemic harm that has happened and stop it happening again;

– Culture and business models are still key things the FCA considers important;

– The FCA continues to adopt a decision-making framework (see, for example, Chapter 4; there are some real nuggets of information here).