Financial services enforcement trends 2022
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The FCA remains committed to identifying and tackling instances of consumer harm, rooting out systemic risk within the industry and securing remediation where things go wrong. Much of the FCA's work here is aimed at restoring trust in the regulated sector and requiring firms to take greater steps to equip clients with necessary information and support.
The regulators view conduct and culture improvements as fundamental to restoring and maintaining public trust in regulated firms. FCA supervisors are increasingly demanding evidence from firms that they are meeting the regulators' objectives for improvement in conduct and culture.
The regulators remain focused on robust cybersecurity and operational resilience systems and controls. The standards expected of firms in this area are only increasing.
This remains one of the FCA's top supervisory and enforcement priorities, with several high-profile cases in 2021. Alongside further enforcement outcomes in 2022, we expect more assertive supervisory interventions including to address new areas of money-laundering risk emerging from disruptive technologies.
Whilst 2021 was a quiet year for market conduct enforcement actions, ongoing hybrid working is prompting policy and supervisory developments, and there remains significant scrutiny of authorised firms and issuers including with respect to continuous disclosure and personal account dealing.
Following a rationalisation of the regulators' caseloads during lockdowns, the regulators will now strive to pick up the pace. But they face headwinds including capacity constraints and growing data volumes, alongside the need to address criticisms from the Upper Tribunal in 2021. Alongside enforcement action, the FCA in particular may increasingly exercise its supervisory powers more rapidly and assertively to address rapidly crystallising risks of consumer harm.