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FCA creates 80 new roles to crack down on rogue firms

·Finance Reporter, Yahoo Finance UK
·2-min read
FCA (Financial Conduct Authority), the Britain's financial regulatory body, is seen at their head offices in London, Britain March 10, 2022. REUTERS/Toby Melville
The new business plan also sets overarching metrics to measure the FCA's performance for the first time. Photo:Toby Melville/Reuters

The City watchdog will recruit 80 new people in a drive to crack down on rogue firms in the UK market.

In its new three-year strategy, the Financial Conduct Authority (FCA) said it is creating the new positions to shut down misbehaving firms.

“A key focus of the strategy is shutting down problem firms, which do not meet basic regulatory standards,” the watchdog said.

Read more: FCA warns more self-invested personal pension providers to go bust

“The FCA is recruiting 80 employees to work on the initiative, which will protect consumers from potential fraud, poor treatment and create a better market.”

The regulator is concerned that the cost of living crisis could see households turn to lenders in greater numbers to manage their finances.

The FCA said the new strategy prioritises resources to “prevent serious harm, set higher standards and promote competition.”

The regulator is developing a metric to monitor the accuracy with which it can identify firms' resilience to financial or other stress and rectify the situation accordingly.

It will achieve these outcomes through setting rules and standards on firms such as embedding the new investment firms prudential regime, inputting into developing crypto policies and developing standards for consumer investments firms promoting the need for wind down plans.

It will identify harm and act to mitigate it quickly by using data dashboards to identify reduce harm emerging issues.

The FCA also said it will “act faster” to remove firms who do not meet its minimum standards for consumer and will improve its capacity to intervene when firms can’t meet threshold conditions.

Read more: City regulator on hiring spree as 200 set to join

FCA CEO Nikhil Rathi said: “Our new strategy enables the FCA to respond more quickly to the rapidly changing financial services sector.

“It will give us a foundation to continuously improve for the benefit of our stakeholders, and respond swiftly to economic and geopolitical developments.”

The regulator will for the first time publish performance metrics to hold itself accountable.

The strategy builds on activities launched last July, when Rathi committed the regulator to become more innovative, assertive and adaptive.

The watchdog has faced criticism in the past over its slow progress at cracking down on problem firms, including the London Capital & Finance mini-bond scheme.

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