Thought for the Week: The 12 Thoughts of Christmas
18 December 2023
18 December 2023
With the bells ringing, the choirs singing and the Christmas parties swinging, we all know it is that special time of year in which we look back on the events of 2023; and what better way to do this than through the lens of our favourite Thoughts for the Week…
The Financial Conduct Authority, in particular its enforcement division, has been a chief protagonist in a number of our Thoughts this year. We reported on the FCA's Business Plan and the enforcement trends reflected by the Annual Report and, more recently, commented on the strategic direction of the new enforcement co-directors. We also brought you insights into the FCA's costly tussle with the Upper Tribunal, concerning its judgment in the Seiler, Whitestone and Reitzin reference.
This year the FCA has worked hard to embed its new Consumer Duty, and we commented on its first 'scalp' when a firm altered its charging structure to improve the process for customers.
Compliance with the Consumer Duty forms part of the FCA's general aspiration to radically improve conduct and culture in financial services. One way it intends to achieve this is by broadening its rules on conduct and fitness and propriety to specifically include non-financial misconduct. We commented on the FCA's campaign to regulate in the key of 'C' – making it clear to firms that conduct, culture and compliance with the Consumer Duty should all work in harmony together. The FCA's initiatives strike a chord with other, wider societal movements to improve workplace culture: we bring you up to date on the new enhanced whistleblowing protections expected to come into force and a general focus on eliminating workplace bullying.
As well as setting out its own consultation on diversity and inclusion in conjunction with the FCA, the Prudential Regulatory Authority's other significant policy consultation this year was on its 'approach to enforcement'. In particular, we discuss the PRA's proposed Early Account Scheme and the reasons that firms might find it problematic.
We told you what you needed to know about the new Economic Crime and Transparency Act - a key milestone in the history of corporate crime, it created the new offence of a failure to prevent fraud and expanded corporate liability to senior managers for a variety of economic crimes. We expect that regulators and law enforcement, in particular the Serious Fraud Office, will be keen to test out the new legislation next year. This year the SFO could reflect proudly upon its first DPA-related conviction in the Tetris bribery matter.
Due to continuing geopolitical tensions, sanctions continued to be a huge focus this year: with the FCA asking firms to ensure they calibrate their systems and controls correctly to comply with sanctions, the potential expansion of the sanctions regime indicated by the Mints case, and the first use of the Office for Financial Sanctions's enforcement powers in its action against a payment services firm.
In terms of litigation, we brought you up to date on the Supreme Court's verdict not to expand the scope of the Quincecare duty in the Philipps v Barclays case. We also reported on the success of the recent PPI claimants, Potter and Smith. The Supreme Court decided in both cases that their PPI claims were not time-barred – so expanding the scope for further PPI claims to be made in the future. We also provided insights into the PACCAR judgment and the potential to blow that it bestowed on litigation funders.
Our thoughts extended to scanning new digital horizons: focusing on proposals for the new digital pound, law enforcement against decentralised autonomous organisations and crypto-assets more generally.
We hope you have a very merry seasonal break and we look forward to providing you with many more Thoughts for the Week in 2024.
Authors: Fraser Collingham, Eleanor Robinson and Nathan Willmott