FCA
FCAAlso called financial Conduct Authority
The Financial Conduct Authority is the UK's conduct regulator for financial services. It authorises and supervises around 42,000 firms, sets rules in its Handbook and enforces them. Its objectives are to protect consumers, protect market integrity and promote competition. It is independent, funded by fees on firms and accountable to the Treasury and Parliament.
How it works
The FCA took over conduct regulation on 1 April 2013 when the Financial Services Authority was split. It is the prudential supervisor for most firms, while the PRA supervises banks, insurers and major investment firms. Its Handbook covers conduct, systems and controls, financial crime and reporting. It also supervises firms' anti-money laundering systems and runs the UK transaction reporting regime.
The FCA can authorise and remove permissions, appoint skilled persons, investigate, fine, ban individuals and prosecute some offences. Since 2023 it has a secondary objective to support UK competitiveness and growth. It runs a regulatory sandbox and innovation services. For RegTech buyers, its rules on systems and controls, outsourcing, the Consumer Duty and the Senior Managers regime shape what tools firms need.
The rules
Replaced the Financial Services Authority with the FCA and the PRA and set the FCA's strategic and operational objectives.
UK financial services firms and marketsProhibits regulated activity without authorisation and gives the regulators rule-making, investigation and enforcement powers.
Firms carrying on regulated activities in the UKGave the FCA a secondary objective to support UK international competitiveness and growth and starts replacing retained EU law with regulator rules.
UK financial services regulators and firmsCommon questions
What is the difference between the FCA and the PRA?
The FCA regulates conduct for all authorised firms and prudential standards for most of them. The PRA, part of the Bank of England, is the prudential regulator for around 1,500 banks, building societies, credit unions, insurers and major investment firms.
What enforcement powers does the FCA have?
It can fine firms and individuals, suspend or cancel permissions, ban individuals from regulated roles, require redress, appoint skilled persons to review firms, and prosecute certain criminal offences such as insider dealing.
Does the FCA have specific rules on AI?
It has not issued AI-specific rules. It applies existing rules, including the Consumer Duty, systems and controls requirements and the Senior Managers regime, to firms' use of AI, and runs testing services for AI use cases.
How is the FCA funded?
The FCA is an independent public body funded entirely by fees charged to the firms it regulates. It receives no government funding for its core work and is accountable to the Treasury and to Parliament.
Our coverage
News and analysis on regulatory change from RegTech Post.
Read the coverage →RegTech PostPreparing for FCA Transaction Reporting Changes by April 2028Read the article →RegTech PostFCA Bans Jeffrey Dawkins, Fines Him Nearly £270,000 Over Mini-BondsRead the article →
