UK FCA update on personal investment firms and capital deduction for redress

The UK Financial Conduct Authority (FCA) has updated its webpage on its consultation paper CP23/24: capital deduction for redress: personal investment firms. The consultation was issued in response to the FCA identifying significant redress liabilities falling to the Financial Services Compensation Scheme, in order to strengthen prudential requirements so that personal investment firms have to hold more capital for redress. The consultation is now closed, and the FCA has updated its webpage to confirm that it is considering feedback. However, the updated webpage also confirms that the FCA is looking across at feedback linked to other proposals including the call for input on modernising the redress framework, and its review of regulatory requirements following the introduction of the Consumer Duty. The FCA also confirms that it will continue to carry out increased monitoring of firms as part of its authorisation process, and highlights the update it published in January which sets out FCA expectations on redress liabilities, and what firms should and should not do to tackle polluting behaviour and meet their redress liabilities.

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