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FCA reveals number of firms breaching ‘basic regulatory requirements’

Handcuffs Justice Guilty 480The FCA cancelled the authorisations of more than 200 firms last year for failing to meet “basic regulatory requirements” like paying their fees or filling out regulatory returns.

The regulator revealed the figure in an update today, that its Threshold Conditions Team took enforcement action against at least 207 firms for failing such compliance failings in the year to June, despite providing “accessible information” about why meeting the regulator’s requirements is important.

The FCA has previously published details of a number of IFA firms who had their permissions cancelled for failing to pay their regulatory fees, or for failing to submit their regulatory returns.

The FCA also noted that the TCT can have firms referred to it, who then comply with the rules late, and have been allowed to keep conducting regulated business.

However, the FCA notes that “where firms are repeatedly referred to enforcement for failing to comply with basic requirements, enforcement will recommend that their permissions are cancelled even if the firms comply late”.

Other firms choose to voluntarily have their authorisation taken away, and 122 did so last year.

Of the 1,387 referrals to the TCT, 824 were able to rectify the situation through completing any outstanding returns or funding any outstanding levies.

In its note today, the FCA also reminded advisers who will fall under Mifid II needed to submit their permission forms “without further delay” before rules come in in January.

The FCA writes: “Firms who do not have the required permissions by 3 January 2018 will need to have contingency plans in place.”


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There are 5 comments at the moment, we would love to hear your opinion too.

  1. Neil Liversidge 17th August 2017 at 3:11 pm

    Some if not all of these firms will be taking the easy route to de-authorisation in preference to going through what is no doubt a long-winded and extremely bureaucratic process.

    • That’s a bit short-sighted unless you’re retiring though. I can’t see having such a blatant black mark against you will help any future attempt to get back into a regulated position.

      And the one thing we have seen over the last decade and a half is that the FSA/FCA’s boundary keeps expanding. IFAs, mortgage and GI, consumer credit, CMCs coming next year… and that’s without the general Google risk that the publication of the cancellation gives you.

    • Nonsense Neil and I speak from personal experience. De-authorisation was simplicity itself and went through very smoothly and quickly in a matter of weeks.

      I can only imagine that it is long winded and bureaucratic if you don’t have a good record.

      I would suggest that those firms not paying their fees on time and not completing returns shows that there are still too many cowboys in this industry that need weeding out.

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