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March 2024 Regulation Update

Kyte Ekstrom

1 Apr 2024

Each month we publish a round-up of the latest regulatory updates, covering only the salient points, including links to relevant documents and webpages.


IA Publishes Guidance - severe but plausible scenarios in the context of operational resilience

The Investment Association (IA) has published guidance on 'severe but plausible scenarios (SBP)' in the context of operational resilience. By the end of the operational resilience implementation period, at the end of March 2025, the FCA expects firms to ensure they can operate within impact tolerances at all times, including during SBP scenarios. 

The document contains a summary of key points from various applicable regulatory sources which refer to the concept of SBP and aims to address ambiguities around the concept of SBP scenarios and to identify best practices in calibrating SBP scenarios through an SBP ‘library’.

IA guidance: Operational resilience: severe but plausible scenarios

FCA Publishes Finalised Guidance - financial promotions on social media

The FCA originally consulted on this back in July 2023, citing that social media has become an increasingly vital part of firms’ marketing strategies, allowing them to reach a mass audience at increasing speed and frequency. The FCA has expressed concern over poor quality financial promotions leading to significant consumer harm due to their wide reach and the complex nature of financial services. After reviewing the consultation feedback and making targeted amendments to the previous guidance (FG15/4), the FCA is replacing FG15/4 with the new finalised guidance, FG24/1.

The guidance does not create new obligations but clarifies the FCA's expectations of firms and other persons (such as influencers and ‘finfluencers’) communicating financial promotions on social media. FG24/1 replaces the FCA's previous guidance on social media and customer communications (FG15/4), which was published in March 2015.

FCA Finalised Guidance: Financial promotions on social media (FG24/1)


Press release

FCA Statement Published - changes to financial promotion order exemptions

The Financial Services and Markets Act 2000 (Financial Promotion) (Amendment and Transitional Provision) Order 2024 has been published with an explanatory memorandum. The effect of the statement is to reinstate both the financial thresholds necessary to meet the high net worth individual exemption and the eligibility criteria for the self-certified sophisticated investor exemption that were in place before the Financial Services and Markets Act 2000 (Financial Promotion) (Amendment) (No 2) Order 2023 (SI 2023/1411) came into force.

The Order, which was made on 5 March 2024 and laid before Parliament on 6 March 2024, comes into force on 27 March 2024.

The FSMA (Financial Promotion) (Amendment and Transitional Provision) Order 2024

Explanatory memorandum


FCA statement

FCA Publishes New Webpage - wind-down planning

The page covers how to prepare a wind down plan and scenarios which could lead to a wind-down, and to a potential recovery. It also provides relevant links for firms applying for authorisation to help them understand what information should be submitted as part of their application.


FCA publishes Dear CEO letter to Annex 1 firms - AML framework failings

The Dear CEO letter sent to financial institutions within the scope of Annex 1 of the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (SI 2017/692) (the MLRs) sets out the FCA's findings from its recent assessments of how firms are complying with money laundering regulations.

The FCA has noted discrepancies between firms' registered and actual activities including a lack of financial crime controls to keep pace with business growth. Another common issue highlighted is the lack of detail in firms' customer due diligence and monitoring policies. The FCA expect firms to complete a gap analysis against each of the common weaknesses outlined within six months of receipt of the letter, and to take prompt and reasonable steps to close any gaps identified.

FCA Dear CEO letter to Annex 1 firms

Press release

FCA Publishes - enforcement guide and publicising enforcement investigations–a new approach

The FCA has published consultation paper (CP24/2**) which contains proposals on a new, more proactive approach to publicising its enforcement investigations.

The proposals, would take the form of amendments to the Enforcement Guide (EG) part of the FCA Handbook, and would involve publicly announcing that the FCA has opened an enforcement investigation (including the identity of the subject of the investigation) and publishing updates on the investigation, if deemed in the public interest to do so. The FCA sets out a 'new public interest framework' which is proposed to inform this decision-making.

Comments to the consultation paper are requested by 16 April 2024.

Consultation Paper CP24/2

Press release

Financial Ombudsman Announcement - increased award limits 

The FCA has confirmed the increases to the FOS's award limits for complaints with effect from 1 April 2024.

The awards are as follows:

  • £430,000 for complaints about acts or omissions by firms on or after 1 April 2019; and

  • £195,000 for complaints about acts or omissions by firms before 1 April 2019.

Press release

FCA Publishes Announcement - review of firms' treatment of customers in vulnerable circumstances

The review will look at firms’ understanding of consumer needs, the skills and capability of staff, product and service design, communications and customer service, and whether these support the fair treatment of customers in vulnerable circumstances. The press release emphasises that under the Consumer Duty, firms are required to act to deliver good outcomes for all customers, including those with characteristics of vulnerability.

The FCA intends to share the findings of this review by the end of 2024.

Press release

FCA and other regulators publish expectations - debt collection best practices

The UK Regulators Network (UKRN) has published a joint statement from the FCA, Ofcom, Ofgem and Ofwat setting out their shared expectations in relation to debt collection by regulated companies. The regulators explain in the statement the consumer outcomes that they expect to see firms delivering, in response to identified consumer harms that cut across sectors.

The four regulators previously published a letter (via UKRN) in June 2023 setting out shared expectations on how firms in each sector should support customers in financial difficulty.

FCA, Ofgem, Ofcom and Ofwat joint statement on debt collection best practices

Press release


FCA Publishes Portfolio Letter Setting Out Risks - consumer lending

The portfolio letter sets out the FCA's supervisory strategy for certain firms involved in the consumer lending market, namely high-cost lenders, mainstream consumer credit lenders and credit unions. The details the FCA's view of the key risks of harm that these firms' activities are likely to pose, grouped under three priority headings: (a) promoting competition and positive change; (b) reducing and preventing serious harm; and (c) setting and testing higher standards.

The FCA expects firms to consider the letter at board level and to be able to explain the actions they have taken in response to the FCA upon request.

Dear CEO Letter: FCA strategy for Consumer Lending

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