The following Financial Services guidance note provides comprehensive and up to date legal information covering:
This Practice Note explains the rights held by certain categories of person to sue authorised firms in circumstances in which they have suffered a loss. The legislative provisions are found in the Financial Services and Markets Act 2000 (FSMA 2000), ss 20, 71 and 138D, and are supplemented by the Financial Services and Markets Act 2000 (Rights of Action) Regulations 2001, SI 2001/2256 (the Rights of Action Regulations).
There are four different causes of action for damages against firms under FSMA 2000 when:
a firm has acted outside the scope of its permission (FSMA 2000, s 20)
a firm has failed to get consent from the Financial Conduct Authority (FCA) to delegate a controlled function (FSMA 2000, s 71)
a firm has breached rules contained in FSMA 2000 (FSMA 2000, s 138D), or
an incoming EEA firm has breached Part XIII rules (FSMA 2000, s 202(2))
FSMA 2000, s 20 provides that a firm is taken to have contravened a requirement under the Act if it acts outside the scope of its Part 4A permission. See Obtaining authorisation—overview, which provides more information on Part 4A permissions.
However, a person who suffers loss as a result of a firm failing to meet its Part 4A financial resource requirements
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