As the agency primarily responsible for the investigation of potential misconduct within the financial services sector in the UK, the Financial Conduct Authority (FCA) continues to investigate many diverse forms of suspected misconduct. While the number of cases under investigation by the FCA’s Enforcement Division continues to grow, there have been signs in the past 12 months that the rate at which new cases are being opened has begun to level off, after an initial steep rise following the introduction of a more ‘diagnostic’ approach to investigations in 2016. In that period, we have seen several firms successfully challenge the penalty proposed by the FCA while reaching agreement on the facts and breaches alleged against them (using what are known as ‘focused resolution agreements’). We anticipate such partially settled cases will become more prevalent given the apparent success of these early examples.
The remainder of this article outlines the FCA’s enforcement process and sets out our view of the FCA’s current enforcement priorities, the agency’s expectations of those subject to investigation, and the FCA’s approach to penalties. Those operating within the financial services sector in the UK need also to be aware of the role of other agencies, in particular the Serious Fraud Office (SFO) with its focus on criminal offences involving serious fraud and bribery (however these are outside the scope of this article).
‘Enforcement 40’ for 2020
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