Hot topics and key learnings from FCA enforcement conference – its (still) all about deterrence

On 5 March 2025, Therese Chambers, Joint Executive Director of Enforcement and Market Oversight at the Financial Conduct Authority (“FCA”), delivered the keynote address at the annual “Trends in Enforcement” seminar hosted by the Financial Service Lawyers Association and Blackstone Chambers. 

Garon Anthony, Financial Services Disputes Partner, attended the seminar and reports here on the important enforcement issues touched upon by Ms Chambers that will concern all members of the FCA regulated community in the UK as they are key in understanding the regulator’s enforcement focus in the years ahead.

Ms Chambers addressed her enforcement mantra of pace, focus and transparency which will underpin her division’s activities going forward.

Increased pace in enforcement activities 

Central to the issue of pace, is the FCA’s recognition of the need to size its investigation portfolio by reference to its capacity to deliver disciplinary outcomes that are timely. And for deterrence of misconduct to be effective and impactful it has to be timely and not yesterday’s news. That means the FCA increasing operational efficiency, reducing its internal bureaucracy and empowering internal teams.

In terms of speeding up investigations, Ms Chambers noted that the average enforcement action is now taking 16 months or less from start to finish, with FCA criminal cases coming in at 24 months or less. That is against a previous average of 42 months. By way of example, she referred to the enforcement action against Starling Bank (fined £29 million by the FCA in November 2024 for failings in financial crimes systems and controls) taking 14 months following supervisory action and action against Volkswagen Financial Services (fined £5.4 million by the FCA in October 2024 over treatment of customers in financial difficulties) taking 13 months following supervisory action. And in a drive to increase pace we can expect increased focus by the FCA  on more intensive supervisory action. Ms Chambers commented:  

“This is part of what is helping us to move faster. We spot things faster. We use the right tools to deal with the harm where it is appropriate. We move into an investigation phase. We know more when we open the investigation because of the assertive supervisory action that we've taken, and we can then move quickly through.”

Other actions that have been taken by the FCA to increase enforcement pace include refreshing its internal decision making framework to speed up operations;  investing in its internal investigations academy so as to provide it teams with the insights and the tools they need to power their work; and  increased use of digital tools, AI and management information in day to day activities. 

Better enforcement focus

As part of this, the Enforcement Division recognises the need to be closely integrated with the rest of the FCA.  They say that this means selecting the right cases for investigation, recognizing the wide range of tools at its disposal to deal with an issue and appreciating that an enforcement investigation is not always the right answer to every regulatory problem. 

In April 2023 there were 220 operations in the FCA’s investigations portfolio, but by  March 2025 that number had fallen to around 135. The regulator says that there has been a significant and purposeful reduction in the amount of active cases and that has been achieved in a number of ways. The FCA has good look at, and shake down of, the enforcement portfolio and, in some instances, it has closed cases that previously it may have continued. But it has also raised the bar to start investigations so the FCA is opening fewer investigations than it has ever done. Ms Chambers commented: 

“And the difference is that we're now much more firmly situated in a real end to end approach at the FCA, where we are more robust at the [authorisation] gateway, so we're better at keeping the bad apples out of the system, and we're more assertive as supervisors, so we will have a much more joined up approach internally, and all of that is happening in close partnership with enforcement teams”.

But she was keen to stress that undertaking fewer investigations faster does not necessarily translate into fewer disciplinary “outcomes”. Ms Chambers noted that the FCA achieved 41 disciplinary outcomes in 2024 against a typical average of 2. Total fines in 2024 amounted to around £174 million with total redress paid to customers and investors of around £460 million pounds (so  the money went to the right place to redress consumers and investors that had lost out through regulatory misconduct).

Transparency of actions

Ms Chambers says that transparency goes wider than the recent FCA’s consultation papers about publishing enforcement action (the “naming and shaming” proposals that we have commented on previously). 

The FCA wants to make much more effective use of communication as an enforcement tool and notes that it can be as effective as it likes, but if nobody knows what it’s doing, or understands its outcomes, then what is the point of the effort and how does this translate into deterrence of misconduct? So, the FCA says it will constantly look for the right opportunities to highlight the key learnings from its enforcement work so that the enforcement news is more widely spread and unacceptable conduct is called out so the regulated community takes notes and raises standards. 

In summary of her enforcement mantra Ms Chambers commented: 

“We're going to carry on working faster. We are going to carry on caring about doing the right thing, redress, fix the issues … We're going to continue to make sure that criminals do not profit from their crimes … and we will continue to not automatically open an investigation every time there is a significant regulatory issue but confidently use all our tools across the organization”.

What does the FCA care about? 

Finally, Ms Chambers turned to the issues that concern the FCA and consequently are on the Enforcement Division’s radar as clear and present dangers. 

These include regulated firms being used as vehicles for fraud or enabling money laundering - keeping dirty money out of the financial ecosystem is critical for keeping UK financial markets “clean”. The FCA already undertakes plenty of AML systems and controls investigations, but they are now increasingly looking at those in the regulated community who bank fraudsters. 

And Ms Chambers noted  that maintaining the trust and confidence of consumers and investors was critical to the UK growth story, as was maintaining the integrity of UK markets (and that extended beyond equity markets, but across the full range of fixed income, currencies, commodities, where she noted that the UK occupies an enviable position globally, due in significant part to the widespread trust and confidence that is placed in the UK's markets. 

Comment

Garon Anthony comments:

“The FCA’s strategy is clear and Ms Chambers is determined in its role in holding to rights those entities which breach the very necessary regulation in the sector.

It was pleasing to see the understanding from the top in relation to the importance of enforcement when it is appropriate and the need for transparency by way of effective communication.

“From the data presented last night, the FCA is already demonstrating how this new strategy is working, and it is hoped that the benefits will be clear for all to see in the coming years.”

If you have any financial services queries, please contact the team.