The FCA has been flexing its muscles this year, taking a more active stance to compliance than it has in previous years.

In April, the regulator set out a new three-year strategy, designed to improve outcomes for consumers and markets in three focus areas:  

• reducing and preventing serious harm;
• setting and testing higher standards; and
• promoting competition and positive change.

In response to this, 8,000 potentially misleading adverts have been removed this year, 14 times more than 2021.

The FCA has also cancelled authorisation of 201 firms that failed to meet minimum standards.

Lending practises

In response to rising living costs this year, a reminder was sent out to 3,500 lenders on how to support borrowers, with 32 lenders also told to make changes to how they treat customers. This led to seven firms paying £12m ($14.5m) in compensation to their customers.

“This has been a difficult year for many people who have been struggling with the cost of living. So it is all the more important that financial companies meet our standards and treat their customers fairly, particularly those who are facing financial difficulties,” said Nikhil Rathi, Chief Executive of the FCA.

“As well as protecting consumers and supporting the vulnerable, we have been dealing with unprecedented market events and reviewing our rules to ensure our regulatory regime is fit for the future. We are working on reforms to the way companies are listed in the UK, which will support growth and competitiveness and continue to support innovative and fast-growing companies,” Rathi added.

Other actions the financial regulator took to improve the market included a wide consultation on a redress scheme for British Steel Pension Scheme members, where the expected payout was to be around £45,000 ($54,000). In relation to the scheme, FCA also fined Pembrokeshire Mortgage Centre Ltd £2.4m ($2,876m) for giving unsuitable advice to consumers.

1,800 scam warnings

The regulator also placed twice as many restrictions on firms that wanted to enter the consumer investment market. In 2021/22, one in five firms was denied permission to operate in the UK, compared to one in 14 in 2020/21.

Sarah Pritchard, Executive Director of Markets at the FCA said: “In the last year we have maintained our focus on acting assertively and innovatively to tackle harm – we prevented one in five firms from entering the consumer investments market and we have taken action against unauthorised firms with a 40% increase in the number of consumer alerts issued. Setting high standards and acting quickly to crack down on problem firms will help ensure market and consumer confidence, supporting the integrity and growth of UK financial services.”

The FCA also issued over 1,800 warnings about potential scam firms so far in this year, which is 400 more than the previous year. The consumer hub, where individuals can report suspicious firms or claim compensation, has also prevented £7m ($9.49m) being lost to fraudsters.

In total, the FCA’s work has contributed to the return of over £30m ($36.39m) to people from businesses operating without authorisation.