U.K. Financial Conduct Authority

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Financial Conduct Authority
FCA logo.png
Founded April 1, 2013
Headquarters London, UK
Products Regulation of standards and conduct at financial firms
Key People Andrew Bailey, Chief Executive

The Financial Conduct Authority is one of three agencies that replaced the U.K. Financial Services Authority, which was decommissioned on April 1, 2013 in a shake-up that gave most of the U.K.'s regulatory power to the Bank of England.[1]

The FCA is the conduct regulator for 58,000 financial services firms and financial markets in the UK and the prudential regulator for more than 18,000 of those firms. It is an independent public body funded entirely by the firms it regulates and is accountable to the UK Treasury and to Parliament.[2]

Its work and purpose is defined by the Financial Services and Markets Act 2000 (FSMA).

It is the FCA's responsibility to ensure that business across financial services and markets is conducted in a way that advances the interests of all users and participants.

Its duties include:

  • Regulation of the prudential standards and conduct of over 20,000 financial firms
  • Protection of the financial sector, participants and the general public by making sure firms stick to the rules and consumers don’t fall victim to scams or get tied in to unfair contracts.
  • Advocacy on behalf of consumers to make sure financial firms and advisers treat consumers fairly and keep to the FCA's rules and standards.

The FCA is made up of nine divisions that work together to deliver its objectives. They are:

  • Supervision – retail and authorisations
  • Supervision – investment, wholesale & specialists
  • Strategy and competition
  • Enforcement and market oversight
  • Markets policy and international
  • Risk and compliance oversight
  • General Counsel
  • Internal audit
  • Operations


History

In 1997 the Chancellor of the Exchequer announced reforms to financial services regulation in the UK. As part of those reforms the FSA was created from the Securities and Investments Board.

On August 7, 2018 the FCA, in collaboration with 11 financial regulators and related organisations, announced the creation of the Global Financial Innovation Network (GFIN), which intends to build on the FCA’s proposal earlier in 2018 to create a ‘global sandbox’ for fintech innovation.[3]

In October 2020, ahead of the December 31, 2020 Brexit transition, the FCA gave City of London financial firms a 15-month grace period to meet most of the UK's new domestic rules. The firms will have until March 31, 2022 to adapt, during which time they need only meet their existing EU requirements, the FCA said. [4]

As the Brexit deadline loomed closer, the FCA said on November 4, 2020 that it would diverge from the EU’s financial market rule book, MiFID, if European regulators failed to treat London’s stock exchanges as having a supervisory system equal to the EU’s own rules. According to a Financial Times report, the statement by the UK regulator was designed to calm investors’ concerns about trading shares around Europe from January 1, 2021, amid frustration over the EU’s silence on post-January 1 arrangements. Uncertainty remains over whether the UK will qualify for EU market access rules when the Brexit transition expires. [5]


Products and Services

Financial Markets Regulation in the UK.

Board Members

  • Andrew Bailey - Chief Executive and executive FCA Board member
  • Charles Randell CBE - Chair
  • Catherine Bradley - non-executive FCA Board member
  • Amelia Fletcher OBE - non-executive FCA Board member
  • Baroness Hogg - non-executive FCA Board member
  • Nick Stace - non-executive FCA Board member
  • Sam Woods - non-executive FCA Board member
  • Christopher Woolard - executive FCA Board member and Director of Strategy and Competition
  • Richard Lloyd - non-executive director

References

  1. U.K. Shakes Up Bank Regulation. WSJ.com.
  2. About the FCA. FCA.
  3. Global Financial Innovation Network. Financial Conduct Authority.
  4. FCA gives City 15 months’ grace on most post-Brexit rules. Financial Times.
  5. UK fires warning shot at Brussels over post-transition share trading. Financial Times.