The Financial Conduct Authority (FCA) has published a new business plan which prioritises retail investors and enhances scrutiny on smaller firms.
The City regulator has laid out four key priorities for the year ahead, all of which focus on the protection and financial wellbeing of retail consumers.
These priorities include a pledge to ensure that retail consumers can access safe payments; to ensure that retail borrowers do not get into unaffordable debt; to empower retail investors to make effective investment decisions about their savings; and to ensure that they are offered fair value products in a digital age.
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“An area where we have seen increasing consumer harm is retail investments,” the business plan stated.
“To help tackle this we are proposing a consumer harm campaign to initially help consumers make better-informed investment decisions. We are consulting on our proposal to undertake this campaign and the basis of recovering the 2020/21 costs from fee-payers.”
The regulator also said that it would be cracking down on smaller firms which are not being operated in accordance with FCA rules.
“Many, but not all, of the 60,000 firms we regulate are committed to acting in line with our rules and principles,” the business plan said.
“Some are not. We will shift our focus towards those firms that consistently fail to meet our required standards. We will move more swiftly to enforcement action against those that fail to do this and so cause harm.”
Addressing the ongoing impact from the coronavirus pandemic, the FCA said that it intends to “focus on ensuring that financial services businesses give people the support they need, that people avoid scams, and that financial services businesses and markets know what we expect of them.”
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“In a matter of weeks, coronavirus has altered the UK’s financial landscape dramatically,” said the FCA’s interim chief executive, Chris Woolard.
“At times like this it is more important than ever that the FCA leads the way on the protection of consumers, firms and the markets.
“Our business plan recognises the impact of coronavirus on the financial services industry, while looking forward at how we transform the FCA’s operations in future.”