FCA says regulators face 'painful lessons' from upcoming autumn reviews

FCA reviews regarding the handling of London Capital & Finance and its collapse in 2019 and the collapse of Connaught Income Fund Series in 2012 are both due out in a few weeks. Both saw investors suffer millions of pounds in losses.

“In the autumn, we will see the results of a number of reviews into potential failures of the regulatory system,” interim CEO Christopher Woolard told a City Week online event.

“I have no doubt there will be painful lessons and the FCA will need to learn from them,” Woolard said.

“But the nature of the work we do means the odds are there will be times where we cannot stop failure or where we call a finely balanced judgement wrongly or miss something,” said Woolard, who steps down at the start of October.

“In a highly regulated market, which finance is, should consumers enjoy no risk? Are all failures and losses within the sector, at least in part, regulatory in nature?”.

The UK is also reviewing financial regulations due to its imminent departure from the European Union and the end of full access to EU banks.

“Our message to firms is, therefore, to continue to prepare – indeed to ramp up preparations – for a range of scenarios,” Woolard said.

Strong regulatory standards go “hand in hand” with Britain’s position as a global financial centre, he said.