FCA opens 11 investigations into potential Consumer Duty breaches as regulator shifts from implementation guidance to active enforcement

The Financial Conduct Authority (FCA) has confirmed it is investigating 11 potential breaches of the Consumer Duty, the principle-based regulatory framework requiring UK financial services firms to deliver good outcomes for retail customers, which came into force in 2023. The announcement marks a notable shift: after spending the first phase of Consumer Duty focused on guiding firms through implementation, the regulator is now moving into active enforcement mode. Separately, the FCA has published research from a mystery shopping exercise finding that a third of experiences with basic bank accounts were rated poor or very poor. The regulator has directed some of the UK's biggest banks and building societies to improve access to these entry-level current accounts, which UK law requires financial institutions to offer, citing the importance of basic accounts for financial inclusion. The FCA has also published its final rules for cryptoasset firms, jointly with the Bank of England, covering trading platforms, intermediaries, custodians, stablecoin issuers, and firms arranging staking. All will require FCA authorisation and must meet prudential requirements including minimum capital buffers and annual stress tests. Notably, the FCA halved its proposed capital requirement for stablecoin issuance, setting it at 1%, half the level imposed by the European Union under its MiCA (Markets in Crypto-Assets) regime. The package of activity from the FCA today signals a regulator simultaneously enforcing existing obligations and opening new authorisation gateways in digital assets.