Rethinking Regulation: FCA’s Push for Robust, Data-Driven Enforcement

In a recent speech, Therese Chambers, the Director of Consumer Investments at the Financial Conduct Authority (FCA), outlined a significant evolution in the organisation’s approach to enforcement. This speech signalled an intent to act with greater vigour and speed while ensuring that the FCA’s regulatory framework adapts to modern demands.

One of the key takeaways from the speech is the FCA’s increasing pace in tackling misconduct. Chambers noted a striking rise in the number of operations shut down, from 38 in the previous financial year to 60 in the latest. This demonstrates a clear shift towards more robust enforcement, with faster responses to misconduct.

Moreover, the FCA is keen to apply lessons from notable cases, such as Citigroup, to its evolving approach. As Chambers remarked, “Systems need to be designed with real people in mind,” emphasising that controls must account for human behaviour. This perspective highlights the importance of recognising the complexity of real-world environments in risk management. Robustness, therefore, extends beyond processes; it must integrate the nuances of human actions and decision-making.

Leveraging Data and Technology for Better Planning

Another crucial point raised is the importance of strategic planning in the FCA’s enforcement efforts. Chambers stressed that enforcement requires not only speed but also precision. She pointed out that the FCA now has access to powerful data and operational tools that can significantly enhance the effectiveness of enforcement strategies. “We must do better, plan better,” she stated, referencing the need to fully utilise these tools in risk management. This signals a forward-thinking approach, where data is not only collected but also analysed and applied to drive more impactful outcomes.

Transparency: A Balancing Act

An interesting development highlighted by Chambers is the FCA’s evolving stance on transparency. The regulator is currently reviewing responses to a recent consultation on whether to publicise the firms under investigation. While there is clear support for greater transparency, Chambers was careful to emphasise that the FCA is prioritising “the right solutions, not the quickest ones.” This cautious approach suggests that the FCA is weighing the need for openness against the potential risks of revealing sensitive information prematurely.

The potential shift towards more public-facing investigations could mark a significant change in how regulatory actions are communicated. However, as Chambers indicates, any steps in this direction will be made thoughtfully, ensuring the decisions are well-calibrated rather than rushed.

A Stronger, More Responsive Regulator

In summary, this speech underscores the FCA’s commitment to evolving its enforcement approach, focusing on being both more robust and agile. By integrating human factors into system design, making better use of data, and carefully considering transparency, the FCA aims to foster a more effective regulatory landscape.

For financial institutions, these changes highlight the importance of having resilient, human-aware systems in place. More importantly, firms should anticipate faster, more decisive regulatory action, especially as the FCA sharpens its focus on transparency and accountability in its operations.
To read more about the FCA’s evolving approach, you can find the full speech here.