Consumer Duty FCAs critical feedback on firms readiness
26 January 2023
The FCA has today (25 January 2023) published feedback on its review of Consumer Duty implementation plans and it doesn't make for comfortable reading.
In its final rules (published in PS22/9 which we summarised here) the FCA set out its expectations including finalised guidance around board approval of firm's implementation plans by the end of October 2022. We know that the FCA has been reviewing some of those implementation plans, with particular focus on larger fixed firms. It has today published its findings from those reviews to help the wider industry meet its implementation expectations.
The FCA looked at:
The regulator's findings make for uncomfortable reading. In a nutshell the message is that firms' need to pull their [socks up/finger out*] (delete as appropriate).
While some plans showed good understanding by firms of the Consumer Duty focus, others suggested that firms might be further behind in their thinking and planning which brings about risks that the firm will fail to meet the deadline. The FCA identified three areas that firms should focus on leading up to 31 July 2023:
The FCA went on to give good and bad practice examples around: governance and oversight; culture and people; deliverability; third parties; four outcomes; and data strategies.
The information provided is not intended to be a comprehensive review of all developments in the law and practice, or to cover all aspects of those referred to.
Readers should take legal advice before applying it to specific issues or transactions.