The following Financial Services guidance note provides comprehensive and up to date legal information covering:
Rule making powers came into force in 2010 which afforded the predecessor to the Financial Conduct Authority (FCA), the Financial Services Authority (FSA) new powers to require authorised firms to create consumer redress schemes. The FCA took over this power when it came into being in 2013. According to guidance originally issued by the FSA, but still relevant to the FCA, a consumer redress scheme is a set of rules under which a firm is required to take one or more of the following steps:
investigate whether, on or after a specific date, it has failed to comply with particular requirements that are applicable to an activity it has been carrying on;
determine whether the failure has caused (or may cause) loss or damage to consumers;
determine what the redress should be in respect of the failure; and
make redress to the consumers.
Section 404 of the Financial Services and Markets Act 2000 (FSMA), provides that if the FCA believe that there is widespread or regular failure by a firm that has caused or may cause damage to consumers, it can make rules requiring the firm to set up a consumer redress scheme. The FCA's power under FSMA 2000 s 404
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