This week’s review include fines for Volkswagen Finance, crypto asset registrations, crackdown on finfluencers, results of the financial misconduct survey and more.
Enforcement
The FCA has fined Volkswagen Financial Services (UK) Limited (Volkswagen Finance) £5,397,600 ($7006366.93) for failing to treat its customers in financial difficulty fairly.
A press release by the regulator says: “Volkswagen Finance has agreed to pay over £21.5m in redress to around 110,000 customers who may have suffered harm because of its failings.
Therese Chambers, Joint Executive Director of Enforcement and Market Oversight, said: “For many, a car is not a nice to have but a necessity for work or for family life. Volkswagen Finance made tough personal situations worse by failing to consider what those in difficulty might need.”
In a separate case of enforcement, the FCA has placed restrictions on Business Agent Limited. The regulator has said in a press release: “The action follows concerns about the firm’s failings related to its ‘Nextcrowd’ platform.”
Key failings uncovered by the regulator include unauthorized handling of client money, ISA regulation compliance issues, lack of systems and controls, failure to disclose information and potential breach of financial promotion rules.
Investors who might have been affected have been “urged to contact Business Agent Limited directly if they have concerns.”
Also last week, the UK regulator said it was interviewing “twenty finfluencers under caution, as it launched targeted action against those who may be touting financial services products illegally”
According to a press release, the regulator also “issued 38 alerts against social media accounts operated by finfluencers which may contain unlawful promotions.”
The FCA has said the step is aimed at preventing young people from falling victims to scams which finfluencers can sometimes be part of.
Consultations
The FCA has said it has “written to investors in Novus Black Fund UK Ltd about the firm’s unreported losses.” The fund is managed by MCI Global Investment Advisors Limited (MCI), which has now gone into liquidation (see details below).
The UK regulator has said: “From the information available, we believe the fund has experienced significant losses that have not been reported to investors.”
Also last week, the FCA and the Practitioner Panel published a report from our 2023/24 joint survey of FCA regulated firms. You can read our full story on the findings of the survey here.
Separately, the FCA has published the results of a survey to better understand how firms record and manage allegations of non-financial misconduct.
You can read our full story about the findings of the survey here.
Media and speeches
The FCA says it notes “the Court of Appeal judgment on motor finance commission and are carefully considering its decision.”
A statement by the regulator says: “We note the Court of Appeal judgment on 25 October 2024, in Johnson v Firstrand Bank Ltd, Wrench v Firstrand Bank Ltd and Hopcraft v Close Brothers Ltd, and are carefully considering its decision.”
Our story published earlier this month gives context to the issue.
The FCA has announced that “MCI Global Investments Advisors Limited entered into Creditors Voluntary Liquidation. Gareth Howarth of Path Business Recovery Limited was appointed as liquidator.”
According to the regulator: “MCI Global Investment Advisors Limited (the firm) is a small Authorised Alternative Investment Fund Manager that provided alternative investment fund management services for funds. This includes Novus Black Fund UK Ltd (the Fund) which is an unauthorised firm.”
Val Smith, Head of payments and digital assets, authorizations division at the FCA, has written a blog titled, Cryptoasset registrations: building strong foundations. She says: “Our standards are setting the stage for a thriving, competitive crypto sector in which people and our financial markets’ integrity are protected.”
And finally, Graeme Reynolds, director of competition at. the FCA, delivered a speech at the Personal Investment Management & Financial Advice Association’s (PIMFA) Wealth Vulnerability event on 24 October 2024.
Highlights include:
- We are aiming to unlock greater competition and innovation.
- We want firms to take time to understand what vulnerability means for their business, and for their client base.
- Firms need to understand what procedures need to be implemented to support the delivery of good outcomes for those different aspects of vulnerability.
