The following Financial Services guidance note provides comprehensive and up to date legal information covering:
There is a fundamental prohibition at the heart of the UK regulatory regime whereby a person cannot carry out a regulated activity in the UK, or purport to do so, unless they are either:
authorised (by the appropriate regulator), or
This is known as the general prohibition and it is found in the Financial Services and Markets Act 2000 (FSMA 2000), s 19.
The inclusion of the phrase 'or purport to do so' means that a person will breach the general prohibition even where they do not carry out a regulated activity but represent that they do or attempt to carry it out.
More information on the general prohibition, exemptions and the regulators can be found in: The general prohibition—overview, The general prohibition and implications of its breach, Financial Conduct Authority—objectives and principles, UK regulators—financial services—overview, What are regulated activities?, Regulated activities—specified activities and investments—overview, Financial Conduct Authority—preparing for authorisation and Prudential Regulation Authority—preparing for authorisation.
Businesses, firms and individuals coming fresh to the financial services market or engaging in new activities need to be clear about the restrictions and the consequences of not obeying financial services-related rules and requirements, such as FSMA 2000, s19. Under FSMA 2000, s 23 it is a criminal offence to contravene the general prohibition, which may lead to an unlimited fine and/or imprisonment for up to two years.
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