Using our full toolkit to help consumers
Executive Summary
This FCA blog post outlines the regulator's supervisory "toolkit" for addressing consumer harm, emphasizing proactive supervision over enforcement to achieve faster outcomes like redress and market-wide improvements. It matters because it signals FCA's preference for swift, non-enforcement interventions (e.g., skilled person reviews, voluntary requirements), urging firms to respond promptly to supervisory feedback to avoid escalation. Compliance teams should view this as a reminder to prioritize Consumer Duty compliance, as supervision tools are increasingly tied to it for rapid harm prevention. #
What Changed
No new rules or requirements are introduced; this is a supervisory strategy update highlighting FCA's full range of tools beyond enforcement. Key emphases include: - Prioritizing supervision for quick fixes, such as multi-firm reviews, good/poor practice guidance, and skilled person reviews (s.166) under FSMA. - Integration of Consumer Duty (Principle 12) as a core principle for assessing and remedying poor outcomes, e.g., unclear policy renewals or inadequate support. - Examples from insurance (e.g., stolen vehicle claims yielding £200m redress; home emergency cover improvements reducing complaints by 61%). #
What You Need To Do
- Embed proactive monitoring
- Respond swiftly to FCA contact
- Improve practices market-wide
- Evidence compliance
- Facilitate redress
Key Dates
Compliance Impact
Urgency: Medium – This reinforces existing obligations under Consumer Duty and Principles, but underscores risk of supervisory escalation if firms ignore early warnings. It matters because FCA prioritizes speed (supervision over enforcement), enabling quick harm fixes but exposing non-responsive firms to s.166 reviews (costly, used 20+ times in insurance since 2022) or restrictions, impacting repu
Who is Affected
Summary
With over 20 years’ experience and responsibility for supervising 5,000 firms, I know that when an issue arises, the first question is often: 'What action will you take?'That’s a fair question – enforcement is one of the most visible ways we act. It often grabs headlines with big fines and publicity.But our role as supervisors is to exercise judgement - selecting the right tool to achieve the best and fastest outcomes for consumers and markets.While enforcement is a vital part of the kit, it’...