The Financial Services Act 2010 received Royal Assent on April 8. The Act has made a number of changes to certain objectives, powers and duties of the UK Financial Services Authority (FSA).
- Financial stability—The new financial stability objective for the FSA includes a duty for the FSA to determine and review its financial stability strategy, in consultation with the Treasury.
- Consumer education—The FSA is required to establish a new consumer financial education body. When this body becomes operational, it will take over the FSA’s current responsibilities in relation to financial education.
- Enforcement powers—Key changes include the power to suspend individuals, and firms, along with the ability to fine those who are carrying out a role that needs FSA approval without the necessary approval being in place. The time limit to issue a warning notice against an individual in relation to misconduct increases from two years to three years from the time the FSA first becomes aware of it.
- Remuneration—The FSA will have the power to specify that remuneration agreements in breach of its remuneration rules are void.
- Consumer redress scheme—The FSA is given the power to introduce a consumer redress scheme. It will come into effect only by order of the Treasury.
Some of the new powers require the FSA to make rules or publish statements of policy. The FSA has stated that it will publish a consultation paper “in due course” concerning implementation of the provisions in the Act. Generally, the Act’s changes were anticipated in the FSA’s Business Plan for 2010-2011, published in March.