FCA enforcement essentials—financial penalties
FCA enforcement essentials—financial penalties

The following Financial Services practice note provides comprehensive and up to date legal information covering:

  • FCA enforcement essentials—financial penalties
  • Introduction to FCA penalties
  • Imposition of an FCA financial penalty
  • Circumstances under which penalties may be imposed
  • Consultation with PRA
  • FCA’s approach to imposition of financial penalties
  • Prohibition against indemnification and payment on behalf of others
  • FCA 2010 penalty regime
  • Five-step framework
  • Step 1—disgorgement
  • More...

Lexis®PSL Financial Services FCA/PRA Enforcement Database: This incorporates detailed information on all substantive FCA and PRA Final Notices and, where available, Decision Notices from 2014 to 2020. The Database, available here, may be searched and filtered by rule breach, keyword, sector, date, seriousness, aggravating and mitigating factors, financial penalty, and other actions such as appeals.

Introduction to FCA penalties

The power of the Financial Conduct Authority (FCA) to impose a financial penalty is an important regulatory tool. There are other sanctions available to the FCA to punish breaches or misconduct by individuals or firms and, indeed, financial penalties may be combined with other regulatory tools (such as prohibition)—however, the ability of the FCA to impose financial penalties is considered to be a one of the most useful tools in the regulator’s toolbox.

More than any other sanction, the imposition of financial penalties tends to attract the most publicity—specifically through the publication by the FCA of Decision Notices and Final Notices which set out the breach, the penalty and how the precise figure of penalty was determined. The effect of specific or general deterrence resulting from such publicly is highly valued by the regulator. Indeed, DEPP 6.1.2 states that financial penalties promote high standards of regulatory and/or market conduct by deterring persons who have committed breaches from committing further breaches or deterring other persons

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