The FCA has published its Regulation round-up for June 2016. The hot topic for this month is access to financial services in the UK. The FCA explains that the launch of its Occasional Paper on Access to Financial Services marks the start of a new conversation about access. Following the success of the work on vulnerable customers, the FCA intends to work collaboratively with firms to design and drive better outcomes for consumers who do not have adequate access to financial services.
Other highlights from the round-up are:
- Complaints handling - The FCA’s announcement that it undertook a market-based thematic review of general insurance complaint handling, ahead of the new complaints handling rules effective from 30 June 2016 (following the FCA’s policy statement PS15/19). The FCA found that generally complaints are handled well, once they are identified. It also highlighted two areas for improvement; the identification of all complaints, in particular expressions of dissatisfaction, and the level of detail in firms’ root cause analysis.
- Reminder of new complaints return – Firms will have to submit a new complaints return for reporting periods starting from 30 June 2016, for submission in early February 2017. The FCA reminds firms that all complaints must be reported, not just those closed after the next business day following receipt.
- Payment shortfalls - The consultation paper CP16/16 on the treatment of mortgage borrowers with a payment shortfall, seeking views on proposed minor amendments to the Mortgages and Home Finance: Conduct of Business sourcebook (MCOB).
- High cost short term credit - The policy statement PS16/15 sets out the feedback received to the FCA’s consultation paper on the proposed response and confirms the final rules and guidance for price comparison websites comparing high-cost short-term credit. The policy statement also provides an update on the FCA’s work on credit broking.
- FCA website - The new FCA website has been launched. The first phase of the new websitewas launched on 10 June 2016, with the second phase expected in August 2016.
- Product oversight and governance - European Banking Authority’s guidelines on products oversight and governance, which will take effect on 3 January 2017, setting out a framework for robust and responsible product design and distribution to avoid future cases of consumer detriment.
- Debt consolidation mortgage advice - firms offering debt consolidation mortgage advice could be carrying on credit-related activities in accordance with Chapter 2 of the Perimeter Guidance Manual (PERG). The FCA confirms that, as an example, a broker may recommend that a debtor should consolidate only certain unsecured debts due under credit agreements into a regulated mortgage contract and the exclusion in Article 39J of the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001 might not be available, as in line with Q5.1 (What is advice?) in PERG 17.5. The FCA emphasises that even implicitly steering the customer to a particular course of action will constitute advice for the purposes of the regulated activity of debt counselling.