Financial Services Regulation

Financial services regulation is complex and constantly evolving. FCA enforcement is increasing with significant penalties for non-compliance, making specialist regulatory advice essential for financial services businesses.

What Our Financial Services Regulatory Solicitors Can Help With

• FCA Authorisation: Regulatory permissions and variation of permission applications
• Compliance Monitoring: Ongoing FCA compliance reviews and regulatory reporting
• Conduct Risk Management: Consumer Duty compliance and fair treatment of customers
• Regulatory Investigations: Defending FCA enforcement actions and investigations
• Senior Manager Regime: SM&CR compliance and fitness and propriety assessments
• Product Governance: MiFID II and product design and distribution requirements
• Anti-Money Laundering: AML compliance programs and suspicious activity reporting
• Consumer Credit: Consumer Credit Act compliance and affordability assessments

FCA Regulatory Framework

FCA Regulatory Objectives:

• Consumer Protection: Securing appropriate degree of protection for consumers
• Market Integrity: Protecting and enhancing integrity of UK financial system
• Competition: Promoting effective competition in interests of consumers

Core FCA Principles:

• Integrity in carrying on business
• Skill, care and diligence in management
• Management and control of affairs responsibly
• Financial prudence in business conduct
• Market conduct and business standards
• Customers' interests and fair treatment
• Communications must be clear, fair and not misleading
• Conflicts of interest management
• Customer relationships of trust and confidence
• Client assets protection
• Relations with regulators must be open and cooperative

Senior Managers & Certification Regime (SM&CR)

Senior Manager Functions:

• Chief Executive Officer
• Chief Finance Officer
• Chief Risk Officer
• Chief Compliance Officer
• Money Laundering Reporting Officer
• Compliance Oversight
• Proprietary Trading
• Significant Management

Conduct Rules Application:

• You must act with integrity
• You must act with due skill, care and diligence
• You must be open and cooperative with the FCA
• You must pay due regard to the interests of customers
• You must observe proper standards of market conduct

Consumer Duty Implementation

Consumer Duty Outcomes:

• Products and Services: Fit for purpose and meet customers' needs
• Price and Value: Fair value that is reasonable relative to benefits
• Consumer Understanding: Clear communications customers can understand
• Consumer Support: Customer service that meets customers' needs

Implementation Requirements:

• Customer outcome monitoring and reporting
• Product and service design reviews
• Pricing and value assessments
• Communication effectiveness testing
• Customer journey optimization
• Vulnerable customer identification and support

FCA Enforcement and Penalties

FCA Enforcement Powers:

• Financial penalties (unlimited for most breaches)
• Public censure and regulatory notices
• Prohibition orders preventing individuals from working in financial services
• Variation or cancellation of permissions
• Restitution orders requiring compensation to consumers
• Criminal prosecution for market abuse and fraud

Recent Penalty Trends:

• Average firm penalty: £5 million-£50 million
• Individual penalties: £50,000-£5 million
• Prohibition orders: 5-10 years typically
• Restitution: Often exceeds £100 million
• Criminal prosecutions increasing

Regulatory Technology and Innovation

RegTech Solutions:

• Automated compliance monitoring systems
• Real-time regulatory reporting
• AI-powered risk assessment tools
• Digital conduct risk monitoring
• Automated suspicious activity detection

Innovation Support:

• FCA Regulatory Sandbox participation
• Innovation pathways for new technologies
• Digital regulatory reporting implementation
• Operational resilience frameworks
• Environmental, Social and Governance (ESG) compliance

Financial Services Regulation Costs

Authorisation and Permissions:

• Simple authorisation: £15,000-£50,000
• Complex permissions: £50,000-£200,000
• Variation of permission: £10,000-£50,000
• FCA application fees: £1,500-£25,000

Ongoing Compliance:

• Annual compliance review: £10,000-£50,000
• Consumer Duty implementation: £25,000-£100,000
• SM&CR compliance program: £15,000-£75,000
• AML compliance review: £5,000-£25,000

Investigation Defence:

• FCA investigation representation: £50,000-£500,000
• Enforcement action defence: £100,000-£1 million
• Skilled person reviews: £25,000-£200,000
• Regulatory remediation: £100,000-£5 million

Why Choose SolicitorConnect for Financial Services Regulation

• FCA Expertise: Solicitors specialising exclusively in financial services regulation
• Industry Knowledge: Deep understanding of financial services business models
• Regulatory Relationships: Established relationships with FCA supervisors and enforcement
• Technical Competence: Understanding of complex financial products and services
• Crisis Management: Rapid response to regulatory investigations and enforcement
• Commercial Focus: Regulatory solutions that support business growth and innovation

Professional financial services regulatory advice is essential for navigating complex FCA requirements and avoiding costly enforcement action in our highly regulated industry.

This information is for general guidance only and does not constitute legal advice. For specific legal advice tailored to your situation, please consult with a qualified solicitor.