Financial Conduct Authority
Vulnerable customers - FCA publishes webpage on firms’ progress towards embedding guidance in FG21/1 - 16 June 2022
The FCA has published a webpage that provides an update on the progress firms have made towards embedding its guidance on the fair treatment of vulnerable customers (FG21/1) (the Guidance), published in February 2021.
The FCA notes that it has seen good examples of individual firms taking positive action to understand the needs of customers in vulnerable circumstances and meeting those needs. However, it has also seen inconsistent practice and identified areas where the FCA expects to see improvement from firms. Among other things, these include:
- monitoring and evaluation: firms need to further develop and improve their management information on the outcomes they are delivering for customers in vulnerable circumstances;
- product and service design: the FCA expects firms to consider the needs of customers in vulnerable circumstances when developing products and services, and across the entire customer journey; and
- senior leaders creating the right cultures and driving strategies: firms should consider whether they have clear lines of accountability for senior leaders and how they can demonstrate how vulnerability features in the considerations of senior and executive committees and in information provided to boards.
New webpage: Ensuring the fair treatment of customers in vulnerable circumstances
Updated webpage: Treating vulnerable consumers fairly
Data strategy - FCA publishes update - 23 June 2022
The FCA has published an update to its data strategy, established in January 2020, highlighting the progress it has made in improving its use of data and its plans to identify and prevent harm sooner.
Among other things, the FCA states that it is using advanced analytics and new sources of data to identify high-risk financial adverts, and that it is scanning approximately 100,000 websites created every day to identify those that appear to be scams. In 2021, 564 promotions were amended or withdrawn (double the number of previous years), and between May 2021 and April 2022 the FCA added 1,966 possible scams to its consumer warning list (over a third more than during the same period the previous year).
Looking forward, the FCA plans to:
- recruit for a significant number of skilled roles across artificial intelligence, analytics and data science, as well as cloud engineering and digital technology;
- continue using advanced analytics and new sources of data to identify inappropriate financial adverts; and
- provide its staff with a dashboard for all the financial companies it regulates and sectors it oversees, to make it easier to identify and focus on the highest risk cases.
The FCA also notes that, following the Russian invasion of Ukraine, it has developed and implemented a sanctions screening tool to support the monitoring of the effectiveness of a firm’s controls in identifying organisations or individuals that have been sanctioned.
FCA Data strategy update 2022
Press release
Innovation in ESG data and disclosures - FCA publishes evaluation paper of digital sandbox - 23 June 2022
The FCA has published an evaluation paper discussing the lessons learned following the conclusion of its digital sandbox sustainability pilot (the Pilot), which ran between November 2021 and March 2022 and which focused on developing technological solutions for enabling transparency in environmental, social and governance (ESG) disclosure and reporting.
Participants of the Pilot unanimously agreed that the initiative has had a significant impact on innovation acceleration, and were pleased that the Pilot is able to bridge the gap between financial services and sustainability. However, participants gave mixed feedback on the data assets available for the Pilot. In some cases, data did not yet exist to meet participants’ requirements or could not be procured within acceptable timeframes.
The FCA notes that the Pilot demonstrated that collaboration and access to data can stimulate innovation in the market. It is committed to establishing a permanent operating model for a digital testing environment based on the Pilot. The FCA is also exploring methods to make the Pilot data assets openly accessible in a way that complies with data protection laws.
Webpage
Digital sandbox sustainability pilot evaluation report
