The Financial Conduct Authority (FCA) has published the second phase of its consultation on proposals for increasing transparency about its enforcement investigations.
It has also set out plans for further engagement after ‘significant concerns’ were raised in relation to the original consultation.
Four significant changes have been made to the FCA’s plans in response to feedback so far.
Firstly, the potential negative impact on a firm would be explicitly considered as part of a public interest test.
Firms would also be given 10 days’ notice ahead of any announcement being made, rather than one day. During this period, firms could make representations.
Third, the potential for an announcement to seriously disrupt public confidence in the financial system or the market has been included as a factor in the public interest test.
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Completing the quartet, the FCA said it would not announce investigations which began before any changes to the policy come into effect. It may reactively confirm investigations which are already in the public domain.
The FCA board aims to make final decisions on changes in the first quarter of 2025.
Steve Smart, joint executive director of enforcement and market oversight, said: “We have made good progress in increasing the focus and pace of our enforcement work – so that we can prioritise the investigations most likely to drive meaningful deterrence across industry and deliver more timely outcomes.
“We want to hear further views on whether some increased transparency could work in practice.”
Therese Chambers, joint executive director of enforcement and market oversight, added: “We have heard the strength of feedback to our original proposals, and we are making changes as a result. We hope the greater detail published today supports the further engagement we hope to have on the proposals, before we make any final decisions.”
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