Source · Select Committees · Public Accounts Committee
Recommendation 12
12
To date, the FCA has only issued one fine in response to the BSPS case.36...
Conclusion
To date, the FCA has only issued one fine in response to the BSPS case.36 It told us that it is working on a further 30 enforcement cases, but despite working as “swiftly 22 Qq 37, 38 (27 April) 23 Qq 37, 38 (27 April) 24 Qq 72–75 (27 April) 25 C&AG’s Report, para 2.12, 2.13 26 Qq 45, 46 (27 April) 27 HC Work and Pensions Committee, British Steel Pension Scheme, HC 828, 15 February 2018 28 Q 76 (27 April) 29 Qq 19–22 (13 June) 30 Q 63 (27 April) 31 Qq 28, 109 (27 April) 32 Q 91 (27 April) 33 Qq 12, 13 (27 April) 34 C&AG’s Report, para 2.18 35 Q 29 (27 April) 36 C&AG’s report, figure 10 12 Investigation into the British Steel Pension Scheme as possible” these have been ongoing for years without progress. The former Chief Executive of the FCA noted that meeting the legal tests for conducting an enforcement case involves a long period of investigation and to rush this may risk losing the case.37 In this investigation period, the FCA does not publish lists of firms or advisers who are under investigation, so consumers are not aware, for example, when searching the FCA Register to find firms which have their permission. The FCA must look into whether it would be an option to publish lists of those under investigation, where there are significant grounds to believe they are committing serious harm to consumers. Two enforcement investigations have been reported publicly by the FCA; however, the remaining cases are subject to legal restrictions and obligations until final decisions are made.38 The FCA maintains a register of regulated advice firms and works to ensure that consumers can quickly identify where non-compliance has occurred.39 However, as unsuitable advice is linked to firms rather than individual advisers, consumers do not know which advisers have provided unsuitable advice.40 These issues risk signalling to consumers that the advice market is safer than it is and highlights the FCA’s failure to deter bad actors from operating within the market.41 This problem
Government Response
Not Addressed
HM Government
Not Addressed
The FCA is able to provide a high-level update on enforcement activity as set out below. 3.2 Enforcement activity related to BSPS is a high priority for the FCA. The FCA currently has c.30 ongoing investigations into firms and individuals relating wholly or partly to BSPS advice. Those investigations are at an advanced stage and five of them have entered either Stage 1 settlement discussions (i.e. a 28 day period within which the subject may agree to the FCA’s findings to resolve matters) or the Regulatory Decisions Committee (i.e. a Committee of the FCA Board which takes contested enforcement decisions on behalf of the FCA and operates separately from the rest of the organisation). If a matter is resolved in Stage 1, the FCA can proceed to publish information about it. If, following Stage 1, the subject contests the matter it moves into the Regulatory Decisions Committee or Upper Tribunal process. The timing of those processes is determined by those respective bodies.