More of the same from the FCA

legal updates

Dealing with discretionary commission arrangements and concern that customers are not getting a fair deal on GAP (Guaranteed Asset Protection) insurance products.

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The Financial Conduct Authority (FCA) published its business plan for 2024-2025 on 19 March 2024. The FCA set out its ambitious programme of work for the final year of its three-year strategy to achieve better outcomes for consumers and markets.

We have seen over the last year that the FCA is certainly ramping up its supervision of firms and will continue this through 2024-2025. In their business plan, they confirmed they are increasing their workforce to more than 5,000, so this supervision is only going to increase.

One of the FCA’s major commitments is “Putting consumers’ needs first” and the introduction of the Consumer Duty in July 2023 enabled the FCA to set higher and clearer standards of consumer protection across financial services.

The two biggest issues that have affected our members in the last few months have been the FCA’s announcement that it is reviewing how firms have been dealing with discretionary commission arrangements and its concern that customers are not getting a fair deal on GAP (Guaranteed Asset Protection) insurance products.

Most recently, the FCA has warned firms to keep their social media advertisements lawful. “The FCA has set out how adverts across social media channels must be fair, clear and not misleading, meaning they must have balance and carry the right risk warnings so people can make well-informed financial decisions.”

Another FCA review currently being conducted that our members should be aware of is the reassessment of firms’ treatment of customers in vulnerable circumstances. This is another review to come off the back of the Consumer Duty, where firms should act to deliver good outcomes for all customers, including those with characteristics of vulnerability.

If you need any assistance or require further information relating to anything mentioned in this update, please do not hesitate to contact Lawgistics.

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Related Legal Updates

While We Wait: Preparing for the FCA’s Review on Motor Finance Commissions

As anticipated, the FCA was not particularly helpful when questioned about the various issues of investigating complaints that were outside of the standard retention periods for documentation.

FCA Commission Review: Separating fact from fiction in the wake of scaremongering

Attend a complimentary seminar hosted by the FCA for first-hand information – Scheduled for Wednesday, 24 January 2024.

The FOS reports over 10,000 motor finance complaints: Are we really surprised?

The good news currently is the FCA is focussing its attention on the lender and not our members.

The FCA means business

The FCA are closely monitoring how firms are putting their new rules in place and will take action against those that aren’t following them.

The Motor Ombudsman (TMO) – Is it “fit for purpose”?

It seems TMO never sought to ask that basic question and, by the time the penny finally dropped, the contract with the finance company had taken place more than six years ago

Financial promotion on social media

The FCA’s supervisory approach to financial promotions in social media was issued in 2015.

Another victory, but the problem has still not gone away!

The FOS confirmed in the article they had not yet published any final decisions on commission-related complaints.

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