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{{short description|British regulator}}
{{Use dmy dates|date=February 2020}}
{{EngvarB|date=February 2020}}
{{Use dmy dates|date=July 2020}}
{{short description|British central banker|bot=PearBOT 5}}
{{Use British English|date=July 2020}}
{{Infobox Officeholder
{{Infobox Government agency
| agency_name = Financial Conduct Authority
| honorific-prefix =
| nativename_r =
| name = Andrew Bailey
| logo = Financial Conduct Authority.png
| honorific-suffix =
| logo_width = 225px
| image = File:Andrew Bailey.jpg
| logo_caption =
| caption = Bailey in 2016
| seal =
| office = [[Governor of the Bank of England]]
| seal_width =
| appointed = [[Sajid Javid]]
| seal_caption =
| term_start = 16 March 2020
| formed = 1 April 2013
| term_end =
| preceding1 = [[Financial Services Authority]]
| predecessor = [[Mark Carney]]
| successor =
| dissolved =
| superseding =
| office1 = [[Financial Conduct Authority|Chief Executive of the Financial Conduct Authority]]
| jurisdiction = [[United Kingdom]]
| term_start1 = 1 July 2016
| headquarters = [[12 Endeavour Square]]<br />[[London]]
| term_end1 = 15 March 2020
| employees =
| predecessor1 = [[Tracey McDermott]]
| budget = £632.6m (2019/2020)<ref>{{cite web |url= https://www.fca.org.uk/annual-report-and-accounts-2019-20 |title= Annual Accounts and Reports 2019/2020 |publisher=FCA |access-date= December 29, 2020}}</ref>
| successor1 = [[Nikhil Rathi]]
| minister1_name =
| office2 = [[Deputy Governor of the Bank of England#With specific responsibility|Deputy Governor of the Bank of England for Prudential Regulation]]
| minister1_pfo =
| governor2 = [[Mark Carney]]
| minister2_name =
| term_start2 = 1 April 2013
| minister2_pfo =
| term_end2 = 1 July 2016
| chief1_name =
| predecessor2 = Office Created
| chief1_position =
| successor2 = [[Sam Woods (civil servant)|Sam Woods]]
| chief2_name = [[Nikhil Rathi]]<br>(Chief Executive)
| office3 = [[Chief Cashier of the Bank of England]]
| chief2_position =
| governor3 = [[Mervyn King (economist)|Mervyn King]]
| chief3_name =
| term_start3 = 1 January 2004
| chief3_position =
| term_end3 = 1 April 2011
| chief4_name =
| predecessor3 = [[Merlyn Lowther]]
| chief4_position =
| successor3 = [[Chris Salmon]]
| chief5_name =
| birth_date = {{birth date and age|df=y|1959|3|30}}
| chief5_position =
| birth_place = [[Leicester]], [[England]]
| chief6_name =
| spouse = [[Cheryl Schonhardt-Bailey]]
| chief6_position =
| children = Hannah Bailey
| chief7_name =
Samuel Bailey
| chief7_position =
| alma_mater = [[Queens' College, Cambridge]]
| chief8_name =
| occupation = [[Central bank]]er
| chief8_position =
| website =
| chief9_name =
|otherparty=None}}
| chief9_position =
| parent_department =
| parent_agency =
| child1_agency =
| keydocument1 =
| keydocument2 =
| website = {{url|https://www.fca.org.uk/}}
| footnotes =
}}The '''Financial Conduct Authority''' ('''FCA''') is a [[financial regulation|financial regulatory]] body in the [[United Kingdom]], but operates independently of the UK Government, and is financed by charging fees to members of the financial services industry.<ref name="hm-treasury">{{Cite web | title =First Chair of the new Financial Conduct Authority appointed| url = http://www.hm-treasury.gov.uk/press_43_12.htm | access-date = 2 November 2012 }}</ref> The FCA regulates financial firms providing services to consumers and maintains the integrity of the financial markets in the United Kingdom.<ref name="vina">{{cite news|url=http://www.businessweek.com/news/2010-06-16/u-k-scraps-fsa-in-biggest-bank-regulation-overhaul-since-1997.html|title=U.K. Scraps FSA in Biggest Bank Regulation Overhaul Since 1997|last=Vina|first=Gonzalo|work=Businessweek|publisher=Bloomberg|access-date=16 June 2010}}</ref>


It focuses on the regulation of conduct by both retail and wholesale financial services firms.<ref name="treasury1">{{cite web|url=http://www.hm-treasury.gov.uk/reform_and_regulation.htm|title=Reform and regulation|date=17 June 2010|publisher=HM Treasury|access-date=17 June 2010}} [http://nationalarchives.gov.uk-webarchive.info/-/www.hm-treasury.gov.uk/reform_and_regulation.htm Archived here.]</ref> Like its predecessor the [[Financial Services Authority|FSA]], the FCA is structured as a [[company limited by guarantee]].<ref>Goldsworth, J., ''Lexicon of Trust & Foundation Practice'' ([[Wendens Ambo]]: Mulberry House Press, 2016), [https://books.google.com/books?id=yf6-CwAAQBAJ&pg=PA140 p. 140].</ref>{{rp|140}}
'''Andrew John Bailey''' (born 30 March 1959) is a British [[central bank]]er who has been [[Governor of the Bank of England]] since 16 March 2020.


The FCA works alongside the [[Prudential Regulation Authority (United Kingdom)|Prudential Regulation Authority]] and the [[Financial Policy Committee]] to set regulatory requirements for the financial sector. The FCA is responsible for the conduct of around 58,000 businesses which employ 2.2 million people and contribute around £65.6 billion in annual tax revenue to the economy in the United Kingdom.<ref name="vina" />
Previously he served as the [[Chief Cashier of the Bank of England]] from January 2004 until April 2011, [[Deputy Governor of the Bank of England]] from April 2013 to July 2016, and Chief Executive of the [[Financial Conduct Authority]] from 2016 to 2020.<ref>{{Cite web|url=http://www.bankofengland.co.uk/about/people/andrew-bailey/biography|title=Andrew Bailey|website=www.bankofengland.co.uk|language=en|access-date=2020-03-16}}</ref>


==Education==
==History==
On 19 December 2012, the [[Financial Services Act 2012]] received [[royal assent]], and it came into force on 1 April 2013. The Act created a new regulatory framework for financial services and abolished the Financial Services Authority.<ref name= treasury>{{cite web |url=http://www.hm-treasury.gov.uk/press_126_12.htm |title=Financial Services Bill receives Royal Assent |date=19 December 2012 |publisher=[[HM Treasury]] |access-date=4 January 2013}}</ref>


Specifically, the Act gave the [[Bank of England]] responsibility for financial stability, bringing together macro and micro prudential regulation, created a new regulatory structure consisting of the Bank of England's Financial Policy Committee, the [[Prudential Regulation Authority (United Kingdom)|Prudential Regulation Authority]] and the Financial Conduct Authority.<ref name= treasury/>
Bailey attended [[Wyggeston Grammar School for Boys|Wyggeston Boys' Grammar School]], Leicester from where he went to [[Queens' College, Cambridge]], where he gained a [[Bachelor of Arts|BA]] in History and a PhD from the [[Faculty of History, University of Cambridge]] in 1984 with a thesis on ''The impact of the Napoleonic Wars on the development of the cotton industry in Lancashire: a study of the structure and behaviour of firms during the Industrial Revolution''.<ref>{{cite web |title=The impact of the Napoleonic Wars on the development of the cotton industry in Lancashire: a study of the structure and behaviour of firms during the Industrial Revolution |url=https://idiscover.lib.cam.ac.uk/permalink/f/16u99e0/44CAM_ALMA21428196350003606 |website=Cambridge University Library |access-date=23 December 2019}}</ref><ref>[https://www.bankofengland.co.uk/-/media/boe/files/about/people/andrew-bailey/cv.pdf "Andrew Bailey CV"], ''www.bankofengland.co.uk''. Retrieved 17 March 2021.</ref>


In March 2020, the FCA introduced new [[strong customer authentication]] rules<ref>{{Cite web|date=2019-09-02|title=Strong Customer Authentication|url=https://www.fca.org.uk/firms/strong-customer-authentication|access-date=2020-06-23|website=FCA|language=en}}</ref> aiming to reduce fraud and improve security for customers by requiring European banks to offer customers three layers of authentication when customers make online payments over €30 in Europe:
After university, Bailey became a research officer at the [[London School of Economics]], before joining the [[Bank of England]] in 1985.


* PIN code or a password
He has worked at the Bank of England in a number of areas, most recently as executive director for banking services and as Chief Cashier, as well as head of the bank's Special Resolution Unit (SRU). Previous roles include Governor's private secretary, and head of the International Economic Analysis Division in Monetary Analysis.
* [[Biometrics]] such as a fingerprint
* Physical device such as a phone


==Powers==
Since the onset of the financial crisis in August 2007 and until April 2011, Bailey was responsible for the bank's special operations to resolve problems in the banking sector, and in 2009 was chairman and chief executive of Dunfermline Building Society Bridge Bank Ltd.
The authority has significant powers, including the power to regulate conduct related to the marketing of financial products. It is able to specify minimum standards and to place requirements on products.<ref name="FT-What&Who">{{cite news|title=The Financial Conduct Authority: What it Does and Who is Charge|url=https://www.telegraph.co.uk/finance/newsbysector/banksandfinance/8874588/The-Financial-Conduct-Authority-what-it-does-and-who-is-charge.html|access-date=20 August 2012|newspaper=[[Financial Times]]|date=8 November 2011|location=London}}</ref> It has the power to investigate organisations and individuals.<ref>{{cite web|url=http://www.fca.org.uk/consumers/financial-services-products/investments/news-and-investigations|title=News and investigations|work=fca.org.uk|access-date=6 June 2015}}</ref> In addition, the FCA is able to ban financial products for up to a year while considering an indefinite ban; it has the power to instruct firms to immediately retract or modify promotions which it finds to be misleading and to publish such decisions.<ref>Bond, R., [https://www.lexology.com/library/detail.aspx?g=dea011e4-dde0-41e4-a18a-78f52199a8c5 "e-Commerce in United Kingdom"], Lexology, August 15, 2019.</ref>
On 1 April 2013 Bailey became the chief executive of the new [[Prudential Regulation Authority (United Kingdom)|Prudential Regulation Authority]]<ref name="bankofengland1">[http://www.bankofengland.co.uk/about/people/biographies/bailey.htm About the Bank | People | Andrew Bailey – Executive Director and Head of the Prudential Business Unit] {{Webarchive|url=https://web.archive.org/web/20170210201814/http://www.bankofengland.co.uk/about/people/biographies/bailey.htm/ |date=10 February 2017 }}. Bank of England. Retrieved 28 April 2012.</ref> and the first deputy governor of the Bank of England for Prudential Regulation.


Further, the FCA is able to freeze assets of individuals or organisations under investigation whether or not they are innocent or guilty.<ref>{{cite web |url=https://www.handbook.fca.org.uk/handbook/EG/10/3.html?date=2016-06-01|title=News and investigations|work=fca.org.uk|access-date=27 February 2019}}</ref><ref>Chitimira, H., ''Market Abuse Regulation in South Africa, the United States of America and the United Kingdom'' ([[Wilmington, Delaware|Wilmington, DE]]: Vernon Press, 2018), [https://books.google.com/books?id=cbiEDwAAQBAJ&pg=PA143 p. 143].</ref>{{rp|143}} The authority has been responsible for regulating the consumer credit industry since 1 April 2014, taking over the role from the [[Office of Fair Trading]].<ref>{{cite web |url=http://www.oft.gov.uk/about-the-oft/work-and-responsibilities/#.UzSb7vmrGD8 |title=OFT’s work and responsibilities after 31 March 2014 |year=2014 |publisher=Office of Fair Trading |access-date=27 March 2014}} [http://nationalarchives.gov.uk-webarchive.info/-/www.oft.gov.uk/about-the-oft/work-and-responsibilities/#.UzSb7vmrGD8 Archived here.]</ref>
On 26 January 2016, it was announced that Andrew Bailey would take over as CEO of the UK [[Financial Conduct Authority]].<ref>{{Cite web|url=https://www.bbc.com/news/business-35408302|title=Andrew Bailey is new City watchdog boss|date=26 January 2016|publisher=BBC}}</ref> He replaced [[Tracey McDermott]], who became acting CEO after [[Martin Wheatley]] resigned following a vote of no confidence by [[George Osborne]] in July 2015.<ref>{{Cite news|url=https://www.theguardian.com/business/2015/jul/17/city-watchdog-chief-quits-fca-george-osborne|title=City watchdog chief quits after George Osborne vote of no confidence|last=Inman|first=Phillip|date=17 July 2015|newspaper=The Guardian|access-date=14 February 2017|issn=0261-3077}}</ref>


==Payment Systems Regulator==
In March 2020 the Treasury select committee criticised the performance of the Financial Conduct Authority. The committee said it would monitor closely the culture, operations and transparency of the FCA. This followed damning criticisms of the watchdog by consumer and industry groups during Bailey’s tenure as its chief executive.<ref>{{Cite web|url=https://www.theguardian.com/business/2020/mar/05/concerns-raised-over-new-bank-of-england-governors-time-at-fco|title=Concerns raised over new Bank of England governor's time at FCA|first=Phillip|last=Inman|date=5 March 2020|via=www.theguardian.com}}</ref>
In April 2015, the FCA created a separate body, the Payment Systems Regulator (PSR), in accordance with section 40 of the Financial Services (Banking Reform) Act 2013.<ref>[http://www.legislation.gov.uk/ukpga/2013/33/section/40/enacted Financial Services (Banking Reform) Act 2013], accessed 13 May 2016</ref> The PSR's role is "to promote competition and innovation in payment systems, and ensure they work in the interests of the organisations and people that use them".<ref>[https://www.psr.org.uk/sites/default/files/media/PDF/MR1512-indirect-access-market-review-interim-report.pdf Market Review into the Supply of Indirect Access to Payment Systems, MR 15/1.2, March 2015], accessed 13 May 2016</ref>


On 20 June 2017, the PSR announced its final decision regarding reforms to the infrastructure of the payment systems in the United Kingdom in order to encourage "better and more innovative services for customers".<ref>{{Cite web|url=https://www.psr.org.uk/psr-publications/market-reviews/Infrastructure-market-review-remedies-decision|title=MR 15/2.5 Market review into the ownership and competitiveness of infrastructure provision: remedies decision|website=www.psr.org.uk|language=en|access-date=2017-07-05}}</ref> The regulator's review from December 2016 found that the central infrastructure for the main retail payment systems in the United Kingdom – [[BACS|Bacs]], [[Faster Payments Service|Faster Payments]] (FPS) and [[LINK (UK)|LINK]] – do not offer effective competition. Two main changes are required:
On 3 June 2019, it was reported in ''[[The Times]]'' that Bailey was the favourite to replace [[Mark Carney]] as the new [[Governor of the Bank of England]].<ref>{{Cite news|url=https://www.thetimes.co.uk/article/the-week-ahead-67jtm7zbv|title=The week ahead|last=Costello|first=Miles|date=3 June 2019|work=The Times|access-date=3 June 2019|issn=0140-0460}} <!-- It was duly announced by Sajid Javid on 20 December 2019 that Andrew Bailey was the new appointee as Governor of the Bank of England. (is this a quote?) --></ref> [[Sajid Javid]] had also intervened in support of Bailey.<ref>{{Cite news |url=https://www.standard.co.uk/business/revealed-sajid-javid-scored-victory-over-rival-dominic-cummings-when-it-came-to-appointing-new-bank-a4354451.html|title=Revealed: Sajid Javid scored victory over rival Dominic Cummings when it came to appointing new Bank of England Governor|date=5 February 2020|work=London Evening Standard |access-date=9 February 2020}}</ref><ref>{{cite web|url=https://www.theguardian.com/business/2019/dec/20/andrew-bailey-appointed-head-of-bank-of-england|title=Andrew Bailey appointed head of Bank of England|website=The Guardian|date=20 December 2019|access-date=2 April 2020|last=Partington|first=Richard|quote=Javid is understood to have decided on Bailey.}}</ref> According to ''[[The Economist]]'', "He is widely seen within the bank as a safe pair of hands, an experienced technocrat who knows how to manage an organisation."<ref name=“veconomist” >{{cite news|title= Andrew Bailey takes over as governor of the Bank of England|url= https://www.economist.com/britain/2020/03/15/andrew-bailey-takes-over-as-governor-of-the-bank-of-england|work=[[The Economist]]|date=15 March 2020}}</ref>
* To undertake a competitive procurement process for future central infrastructure contracts. With this, the PSR hopes to ensure fair, open and transparent procurement of the central payment systems infrastructure and enable new technology providers to enter the market.
* To adopt a common international messaging standard (ISO 20022) for Bacs and Faster Payments. This change aims to lower barriers and encourage new entrants to the market.


==Sectors and firms==
His term will expire on 15 March 2028.


==References==
=== Banks ===
The Financial Services Act of 2012 set out a new system for regulating financial services in order to protect and improve the UK's economy.<ref>{{Cite web|url=https://www.fca.org.uk/firms/banks-building-societies-credit-unions|title=Banks, building societies and credit unions|date=April 27, 2016|website=FCA|access-date=October 20, 2019}}</ref>


The FCA will supervise banks to:
{{reflist}}
* Ensure they treat customers fairly
* Encourage innovation and healthy competition
* Help the FCA to identify potential risks early so they can take action to reduce the risks


=== Mutual societies ===
==External links==
There are more than 10,000 [[Mutual Society|mutual societies]] in the United Kingdom.<ref>McLaughlin, S., ''Unlocking Company Law'' ([[Abingdon-on-Thames]]: [[Routledge]], 2015), [https://books.google.com/books?id=IhfwBgAAQBAJ&pg=PT112 p. 64].</ref>{{rp|64}} The FCA are responsible for:<ref>{{Cite web|url=https://www.fca.org.uk/firms/mutual-societies|title=Mutual societies|date=April 28, 2016|website=FCA|access-date=October 20, 2019}}</ref>
* [http://www.fsa.gov.uk/pages/About/Who/Management/Retail/bailey.shtml Profile at the FSA]
* Registering new mutual societies
* [http://company-director-check.co.uk/director/909510975 Profile at Director Check]
* Keeping public records


* Receiving annual returns
{{s-start}}
{{s-gov}}
{{s-bef|before=[[Mark Carney]]}}
{{s-ttl|title=[[Governor of the Bank of England]]|years=2020–present}}
{{s-inc}}
{{s-end}}


=== Financial advisers ===
{{Governors of the Bank of England}}
Rules came into force in 2012 for [[independent financial advisers]] (IFAs) following the [[Retail Distribution Review]] (RDR) rules.<ref>{{Cite web|url=https://www.fca.org.uk/firms/financial-advisers|title=Financial advisers|date=April 28, 2016|website=FCA|access-date=October 20, 2019}}</ref> To be classed as an IFA, businesses need to:
* Offer a broad range of retail investment products
* Give consumers unbiased and unrestricted advice based on comprehensive and fair market analysis

==Leadership==

=== Chief executive ===
In February 2011, it was confirmed that the new head of the FCA would be [[Martin Wheatley]], formerly chairman of Hong Kong's [[Securities and Futures Commission]].<ref name="FT-What&Who" /><ref name="FSA-Bckgrnd">{{cite web|title=Regulatory Reform|url=http://www.fsa.gov.uk/about/what/reg_reform/background|work=FSA web site|publisher=FSA|access-date=20 August 2012}}</ref><ref name="FT-Weatly to head">{{cite news|url=http://www.ft.com/cms/s/0/c3a14ee0-2eba-11e0-9877-00144feabdc0.html#axzz1Co2YN68v|newspaper=The Financial Times|date=2011-02-02|access-date=2010-02-02|title=Wheatley to head new UK consumer regulator}}</ref><ref name="HMTres-Chair">{{cite web|title=First Chair of the new Financial Conduct Authority appointed|url=http://www.hm-treasury.gov.uk/press_43_12.htm|work=Newsroom & Speeches|publisher=HM Treasury|date=11 June 2012 |access-date=20 August 2012}}</ref> However, Wheatley's appointment was not put in front of the [[Treasury Select Committee]] for a pre-appointment hearing. Instead, the Government stated it would put Wheatley and future chief executives forward for a pre-commencement hearing, i.e. after they had been formally appointed but before they began the role.<ref>{{Cite web|title=House of Commons - The Treasury Committee’s scrutiny of appointments - Treasury Committee|url=https://publications.parliament.uk/pa/cm201516/cmselect/cmtreasy/811/81104.htm|access-date=2020-06-22|website=publications.parliament.uk}}</ref>

In July 2015, Wheatley resigned his post at the FCA following a vote of no confidence by [[George Osborne]].<ref>{{Cite news|url=https://www.theguardian.com/business/2015/jul/17/city-watchdog-chief-quits-fca-george-osborne|title=City watchdog chief quits after George Osborne vote of no confidence|publisher=The Guardian|author=Phillip Inman|date=17 July 2015|access-date=31 December 2015}}</ref> In September 2015, [[Tracey McDermott]] took over from Wheatley as acting chief executive.<ref>{{Cite web |url=https://www.fca.org.uk/news/statements/statement-financial-advice-market-review |title=Statement on the Financial Advice Market Review |date=2015-08-03 |access-date=2019-12-16 }}</ref>

[[Andrew Bailey (banker)|Andrew Bailey]] was appointed chief executive on 26 January 2016.<ref>{{cite web | author=Anon. | url=https://www.bankofengland.co.uk/news/2016/january/andrew-bailey-appointed-ceo-of-the-fca | title=Andrew Bailey appointed CEO of the Financial Conduct Authority | publisher=[[Bank of England]] | date=26 January 2016}}</ref> After Bailey moved to become the [[Governor of the Bank of England]], it was announced that [[Christopher Woolard]] would become the Interim Chief Executive. In June 2020, it was announced that woolard would be succeeded on a permanent basis by [[Nikhil Rathi]].<ref>{{Cite news|last=correspondent|first=Kalyeena Makortoff Banking|date=2020-06-22|title=FCA appoints London Stock Exchange executive Nikhil Rathi as CEO|language=en-GB|work=The Guardian|url=https://www.theguardian.com/business/2020/jun/22/fca-appoints-london-stock-exchange-boss-nikhil-rathi-as-ceo|access-date=2020-06-22|issn=0261-3077}}</ref>

=== List of chief executives ===
{| class="wikitable"
|+
!#
!Name
!Tenure
|-
|1
|[[Martin Wheatley]]
|2013–2015
|-
| -
|[[Tracey McDermott]] (''interim'')
|2015–2016
|-
|2
|[[Andrew Bailey (banker)|Andrew Bailey]]
|2016–2020
|-
| -
|Christopher Woolard (''interim'')
|2020
|-
|3
|[[Nikhil Rathi]]
|2020–
|}

=== Chairperson ===
In June 2012, it was confirmed that [[John Griffith-Jones]] would become the non executive chair of the FCA once the FSA ceases operations in 2013.<ref name="HMTres-Chair" /><ref name="Tel-Jones" /><ref name="FT-Jones">{{cite news|last=Masters|first=Brooke|title=KPMG’s UK boss to chair new watchdog|url=http://www.ft.com/intl/cms/s/0/b665b832-b3e9-11e1-a3db-00144feabdc0.html#axzz240e8Fw4C|access-date=20 August 2012|newspaper=[[Financial Times]]|date=11 June 2012}}</ref> Griffith-Jones joined the FSA board in September 2012, as a non executive director and deputy chair.<ref name="Tel-Jones">{{cite news|title=KPMG UK chairman John Griffith-Jones to head Financial Conduct Authority|url=https://www.telegraph.co.uk/finance/newsbysector/banksandfinance/9323742/KPMG-UK-chairman-John-Griffith-Jones-to-head-Financial-Conduct-Authority.html|access-date=20 August 2012|newspaper=The Telegraph|date=11 June 2012|location=London}}</ref><ref name="FT-Jones" />

==Criticism==
In June 2013, the Financial Conduct Authority was criticised by the [[Banking Standards Board|Parliamentary Commission on Banking Standards]] in their report "Changing Banking for Good", which stated:

{{quote |text=The interest rate swap scandal has cost small businesses dear. Many had no concept of the instrument they were being pressured to buy. This applies to embedded swaps as much as standalone products. The response by the FSA and FCA has been inadequate. If, as they claim, the regulators do not have the power to deal with these abuses, then it is for the Government and Parliament to ensure that the regulators have the powers they need to enable restitution to be made for this egregious mis-selling. |sign="Changing banking for good: Report of the Parliamentary Commission on Banking Standards" |source=[[House of Lords]], [[House of Commons]]<ref>{{cite web|url=https://publications.parliament.uk/pa/jt201314/jtselect/jtpcbs/27/2704.htm|title=Changing banking for good: Report of the Parliamentary Commission on Banking Standards|work=parliament.uk|access-date=6 June 2015}}</ref>}}

The FCA was rebuked by the Treasury Select Committee for lack of concern over the increase in mortgage interest rates of the [[Bank of Ireland]]'s subsidiary of the United Kingdom.<ref>{{cite web|url=http://www.parliament.uk/business/committees/committees-a-z/commons-select/treasury-committee/news/martin-wheatley-boi-letter/|title=Correspondence published with FSA on Bank of Ireland|work=UK Parliament|access-date=6 June 2015}}</ref><ref>{{cite web|url=http://www.scotsman.com/the-scotsman/business/rebuke-for-new-fca-boss-ahead-of-launch-day-1-2864143|title=Rebuke for new FCA boss ahead of launch day|work=scotsman.com|access-date=6 June 2015}}</ref>

There had been calls for the resignation of chairman John Griffith-Jones because of his responsibility for auditing HBOS as chairman of KPMG at the time of the [[financial crisis of 2007–08]].<ref>{{cite news| url=https://www.theguardian.com/business/2013/apr/10/hbos-heat-on-city-regulator-fca | location=London | work=The Guardian | first=Simon | last=Bowers | title=HBOS heat turns on head of new City regulator John Griffith-Jones | date=10 April 2013}}</ref> There has also been criticism of Chief Executive [[Martin Wheatley]] because of his responsibility for the minibond fiasco in Hong Kong. There were not the customary pre-appointment hearings for either John Griffith-Jones or Martin Wheatley, so that people could not disapprove of these appointments by submitting evidence to such hearings.<ref>Wynn, S., [https://www.whatdotheyknow.com/request/why_no_pre_appointment_hearings?utm_campaign=alaveteli-experiments-87&utm_content=sidebar_similar_requests&utm_medium=link&utm_source=whatdotheyknow "Why no pre-appointment hearings for John Griffith-Jones and Martin Wheatley?"], [[WhatDoTheyKnow]], December 2, 2013.</ref>

On 10 December 2014, the FCA released a report from Simon Davis from [[Clifford Chance|Clifford Chance LLP]] inquiring into the events of 27/28 March 2014 relating to the press briefing of information in the FCA's 2014/15 Business Plan.

The report recommended:

* That there be substantial improvement in the procedures relating to the identification, control and release of price-sensitive information,
* That the final version of the FCA's Business Plan should only be made available publicly to all market participants at the same time,
* That the relevant review team address the issue of price-sensitive information in any assessment of a potential thematic review, and
* That the FCA urgently put in place price and volume monitoring procedures, combined with an action plan for the effective management of the FCA's reaction to any issues involving the uncontrolled release of price-sensitive information originating from or involving the FCA.

On 16 December 2014, the Treasury select committee commenced taking evidence on the press briefing. Shortly thereafter, committee chair Andrew Tyrie said it looked as if the FCA had been guilty of an “extraordinary blunder” and had created a “disorderly market” through its actions.<ref>Inman, P., [https://www.theguardian.com/business/2014/dec/16/fca-clive-adamson-quit-insurance "Financial Conduct Authority director quit over insurance review fallout"], ''[[The Guardian]]'', December 16, 2014.</ref>

In 2017, the FCA was criticised by MP [[Chris Philp]], who sat on the [[Treasury Select Committee]], for spending £66,000 on a new logo that was hardly different from their previous logo.<ref>{{cite web|url=https://www.designweek.co.uk/issues/8-14-may-2017/financial-conduct-authority-looks-streamline-simplify-brand-refresh/|title=Financial Conduct Authority looks to streamline and simplify with rebrand|date=10 May 2017|first=Aimée|last=McLaughlin|website=[[Design Week]]|access-date=29 February 2020}}</ref>

==See also==
{{Portal|Banks}}
* [[FCA Controlled Functions]]
* [[Financial Policy Committee]]
* [[Financial Services Authority]]
* [[Prudential Regulation Authority (United Kingdom)|Prudential Regulation Authority]]
* [[Fraud Advisory Panel]]

==References==
{{reflist}}

==External links==
* {{official website|https://www.fca.org.uk/|FCA official website}}


{{Authority control}}
{{authority control}}


[[Category:HM Treasury]]
{{DEFAULTSORT:Bailey, Andrew}}
[[Category:1959 births]]
[[Category:Financial services companies established in 2013]]
[[Category:Alumni of Queens' College, Cambridge]]
[[Category:Private companies limited by guarantee of the United Kingdom]]
[[Category:Alumni of the University of Cambridge]]
[[Category:Financial regulatory authorities of the United Kingdom]]
[[Category:Governors of the Bank of England]]
[[Category:2013 establishments in the United Kingdom]]
[[Category:Chief Cashiers of the Bank of England]]
[[Category:United Kingdom banking law]]
[[Category:Deputy Governors of the Bank of England]]
[[Category:Government agencies established in 2013]]
[[Category:Financial Conduct Authority people]]
[[Category:Financial Conduct Authority people]]
[[Category:Living people]]
[[Category:People associated with the Bank of England]]
[[Category:People educated at Wyggeston Grammar School for Boys]]

Revision as of 19:01, 23 April 2021

Financial Conduct Authority
Agency overview
Formed1 April 2013
Preceding agency
JurisdictionUnited Kingdom
Headquarters12 Endeavour Square
London
Annual budget£632.6m (2019/2020)[1]
Agency executives
Websitewww.fca.org.uk

The Financial Conduct Authority (FCA) is a financial regulatory body in the United Kingdom, but operates independently of the UK Government, and is financed by charging fees to members of the financial services industry.[2] The FCA regulates financial firms providing services to consumers and maintains the integrity of the financial markets in the United Kingdom.[3]

It focuses on the regulation of conduct by both retail and wholesale financial services firms.[4] Like its predecessor the FSA, the FCA is structured as a company limited by guarantee.[5]: 140 

The FCA works alongside the Prudential Regulation Authority and the Financial Policy Committee to set regulatory requirements for the financial sector. The FCA is responsible for the conduct of around 58,000 businesses which employ 2.2 million people and contribute around £65.6 billion in annual tax revenue to the economy in the United Kingdom.[3]

History

On 19 December 2012, the Financial Services Act 2012 received royal assent, and it came into force on 1 April 2013. The Act created a new regulatory framework for financial services and abolished the Financial Services Authority.[6]

Specifically, the Act gave the Bank of England responsibility for financial stability, bringing together macro and micro prudential regulation, created a new regulatory structure consisting of the Bank of England's Financial Policy Committee, the Prudential Regulation Authority and the Financial Conduct Authority.[6]

In March 2020, the FCA introduced new strong customer authentication rules[7] aiming to reduce fraud and improve security for customers by requiring European banks to offer customers three layers of authentication when customers make online payments over €30 in Europe:

  • PIN code or a password
  • Biometrics such as a fingerprint
  • Physical device such as a phone

Powers

The authority has significant powers, including the power to regulate conduct related to the marketing of financial products. It is able to specify minimum standards and to place requirements on products.[8] It has the power to investigate organisations and individuals.[9] In addition, the FCA is able to ban financial products for up to a year while considering an indefinite ban; it has the power to instruct firms to immediately retract or modify promotions which it finds to be misleading and to publish such decisions.[10]

Further, the FCA is able to freeze assets of individuals or organisations under investigation whether or not they are innocent or guilty.[11][12]: 143  The authority has been responsible for regulating the consumer credit industry since 1 April 2014, taking over the role from the Office of Fair Trading.[13]

Payment Systems Regulator

In April 2015, the FCA created a separate body, the Payment Systems Regulator (PSR), in accordance with section 40 of the Financial Services (Banking Reform) Act 2013.[14] The PSR's role is "to promote competition and innovation in payment systems, and ensure they work in the interests of the organisations and people that use them".[15]

On 20 June 2017, the PSR announced its final decision regarding reforms to the infrastructure of the payment systems in the United Kingdom in order to encourage "better and more innovative services for customers".[16] The regulator's review from December 2016 found that the central infrastructure for the main retail payment systems in the United Kingdom – Bacs, Faster Payments (FPS) and LINK – do not offer effective competition. Two main changes are required:

  • To undertake a competitive procurement process for future central infrastructure contracts. With this, the PSR hopes to ensure fair, open and transparent procurement of the central payment systems infrastructure and enable new technology providers to enter the market.
  • To adopt a common international messaging standard (ISO 20022) for Bacs and Faster Payments. This change aims to lower barriers and encourage new entrants to the market.

Sectors and firms

Banks

The Financial Services Act of 2012 set out a new system for regulating financial services in order to protect and improve the UK's economy.[17]

The FCA will supervise banks to:

  • Ensure they treat customers fairly
  • Encourage innovation and healthy competition
  • Help the FCA to identify potential risks early so they can take action to reduce the risks

Mutual societies

There are more than 10,000 mutual societies in the United Kingdom.[18]: 64  The FCA are responsible for:[19]

  • Registering new mutual societies
  • Keeping public records
  • Receiving annual returns

Financial advisers

Rules came into force in 2012 for independent financial advisers (IFAs) following the Retail Distribution Review (RDR) rules.[20] To be classed as an IFA, businesses need to:

  • Offer a broad range of retail investment products
  • Give consumers unbiased and unrestricted advice based on comprehensive and fair market analysis

Leadership

Chief executive

In February 2011, it was confirmed that the new head of the FCA would be Martin Wheatley, formerly chairman of Hong Kong's Securities and Futures Commission.[8][21][22][23] However, Wheatley's appointment was not put in front of the Treasury Select Committee for a pre-appointment hearing. Instead, the Government stated it would put Wheatley and future chief executives forward for a pre-commencement hearing, i.e. after they had been formally appointed but before they began the role.[24]

In July 2015, Wheatley resigned his post at the FCA following a vote of no confidence by George Osborne.[25] In September 2015, Tracey McDermott took over from Wheatley as acting chief executive.[26]

Andrew Bailey was appointed chief executive on 26 January 2016.[27] After Bailey moved to become the Governor of the Bank of England, it was announced that Christopher Woolard would become the Interim Chief Executive. In June 2020, it was announced that woolard would be succeeded on a permanent basis by Nikhil Rathi.[28]

List of chief executives

# Name Tenure
1 Martin Wheatley 2013–2015
- Tracey McDermott (interim) 2015–2016
2 Andrew Bailey 2016–2020
- Christopher Woolard (interim) 2020
3 Nikhil Rathi 2020–

Chairperson

In June 2012, it was confirmed that John Griffith-Jones would become the non executive chair of the FCA once the FSA ceases operations in 2013.[23][29][30] Griffith-Jones joined the FSA board in September 2012, as a non executive director and deputy chair.[29][30]

Criticism

In June 2013, the Financial Conduct Authority was criticised by the Parliamentary Commission on Banking Standards in their report "Changing Banking for Good", which stated:

The interest rate swap scandal has cost small businesses dear. Many had no concept of the instrument they were being pressured to buy. This applies to embedded swaps as much as standalone products. The response by the FSA and FCA has been inadequate. If, as they claim, the regulators do not have the power to deal with these abuses, then it is for the Government and Parliament to ensure that the regulators have the powers they need to enable restitution to be made for this egregious mis-selling.

— "Changing banking for good: Report of the Parliamentary Commission on Banking Standards", House of Lords, House of Commons[31]

The FCA was rebuked by the Treasury Select Committee for lack of concern over the increase in mortgage interest rates of the Bank of Ireland's subsidiary of the United Kingdom.[32][33]

There had been calls for the resignation of chairman John Griffith-Jones because of his responsibility for auditing HBOS as chairman of KPMG at the time of the financial crisis of 2007–08.[34] There has also been criticism of Chief Executive Martin Wheatley because of his responsibility for the minibond fiasco in Hong Kong. There were not the customary pre-appointment hearings for either John Griffith-Jones or Martin Wheatley, so that people could not disapprove of these appointments by submitting evidence to such hearings.[35]

On 10 December 2014, the FCA released a report from Simon Davis from Clifford Chance LLP inquiring into the events of 27/28 March 2014 relating to the press briefing of information in the FCA's 2014/15 Business Plan.

The report recommended:

  • That there be substantial improvement in the procedures relating to the identification, control and release of price-sensitive information,
  • That the final version of the FCA's Business Plan should only be made available publicly to all market participants at the same time,
  • That the relevant review team address the issue of price-sensitive information in any assessment of a potential thematic review, and
  • That the FCA urgently put in place price and volume monitoring procedures, combined with an action plan for the effective management of the FCA's reaction to any issues involving the uncontrolled release of price-sensitive information originating from or involving the FCA.

On 16 December 2014, the Treasury select committee commenced taking evidence on the press briefing. Shortly thereafter, committee chair Andrew Tyrie said it looked as if the FCA had been guilty of an “extraordinary blunder” and had created a “disorderly market” through its actions.[36]

In 2017, the FCA was criticised by MP Chris Philp, who sat on the Treasury Select Committee, for spending £66,000 on a new logo that was hardly different from their previous logo.[37]

See also

References

  1. ^ "Annual Accounts and Reports 2019/2020". FCA. Retrieved 29 December 2020.
  2. ^ "First Chair of the new Financial Conduct Authority appointed". Retrieved 2 November 2012.
  3. ^ a b Vina, Gonzalo. "U.K. Scraps FSA in Biggest Bank Regulation Overhaul Since 1997". Businessweek. Bloomberg. Retrieved 16 June 2010.
  4. ^ "Reform and regulation". HM Treasury. 17 June 2010. Retrieved 17 June 2010. Archived here.
  5. ^ Goldsworth, J., Lexicon of Trust & Foundation Practice (Wendens Ambo: Mulberry House Press, 2016), p. 140.
  6. ^ a b "Financial Services Bill receives Royal Assent". HM Treasury. 19 December 2012. Retrieved 4 January 2013.
  7. ^ "Strong Customer Authentication". FCA. 2 September 2019. Retrieved 23 June 2020.
  8. ^ a b "The Financial Conduct Authority: What it Does and Who is Charge". Financial Times. London. 8 November 2011. Retrieved 20 August 2012.
  9. ^ "News and investigations". fca.org.uk. Retrieved 6 June 2015.
  10. ^ Bond, R., "e-Commerce in United Kingdom", Lexology, August 15, 2019.
  11. ^ "News and investigations". fca.org.uk. Retrieved 27 February 2019.
  12. ^ Chitimira, H., Market Abuse Regulation in South Africa, the United States of America and the United Kingdom (Wilmington, DE: Vernon Press, 2018), p. 143.
  13. ^ "OFT's work and responsibilities after 31 March 2014". Office of Fair Trading. 2014. Retrieved 27 March 2014. Archived here.
  14. ^ Financial Services (Banking Reform) Act 2013, accessed 13 May 2016
  15. ^ Market Review into the Supply of Indirect Access to Payment Systems, MR 15/1.2, March 2015, accessed 13 May 2016
  16. ^ "MR 15/2.5 Market review into the ownership and competitiveness of infrastructure provision: remedies decision". www.psr.org.uk. Retrieved 5 July 2017.
  17. ^ "Banks, building societies and credit unions". FCA. 27 April 2016. Retrieved 20 October 2019.
  18. ^ McLaughlin, S., Unlocking Company Law (Abingdon-on-Thames: Routledge, 2015), p. 64.
  19. ^ "Mutual societies". FCA. 28 April 2016. Retrieved 20 October 2019.
  20. ^ "Financial advisers". FCA. 28 April 2016. Retrieved 20 October 2019.
  21. ^ "Regulatory Reform". FSA web site. FSA. Retrieved 20 August 2012.
  22. ^ "Wheatley to head new UK consumer regulator". The Financial Times. 2 February 2011. Retrieved 2 February 2010.
  23. ^ a b "First Chair of the new Financial Conduct Authority appointed". Newsroom & Speeches. HM Treasury. 11 June 2012. Retrieved 20 August 2012.
  24. ^ "House of Commons - The Treasury Committee's scrutiny of appointments - Treasury Committee". publications.parliament.uk. Retrieved 22 June 2020.
  25. ^ Phillip Inman (17 July 2015). "City watchdog chief quits after George Osborne vote of no confidence". The Guardian. Retrieved 31 December 2015.
  26. ^ "Statement on the Financial Advice Market Review". 3 August 2015. Retrieved 16 December 2019.
  27. ^ Anon. (26 January 2016). "Andrew Bailey appointed CEO of the Financial Conduct Authority". Bank of England.
  28. ^ correspondent, Kalyeena Makortoff Banking (22 June 2020). "FCA appoints London Stock Exchange executive Nikhil Rathi as CEO". The Guardian. ISSN 0261-3077. Retrieved 22 June 2020. {{cite news}}: |last= has generic name (help)
  29. ^ a b "KPMG UK chairman John Griffith-Jones to head Financial Conduct Authority". The Telegraph. London. 11 June 2012. Retrieved 20 August 2012.
  30. ^ a b Masters, Brooke (11 June 2012). "KPMG's UK boss to chair new watchdog". Financial Times. Retrieved 20 August 2012.
  31. ^ "Changing banking for good: Report of the Parliamentary Commission on Banking Standards". parliament.uk. Retrieved 6 June 2015.
  32. ^ "Correspondence published with FSA on Bank of Ireland". UK Parliament. Retrieved 6 June 2015.
  33. ^ "Rebuke for new FCA boss ahead of launch day". scotsman.com. Retrieved 6 June 2015.
  34. ^ Bowers, Simon (10 April 2013). "HBOS heat turns on head of new City regulator John Griffith-Jones". The Guardian. London.
  35. ^ Wynn, S., "Why no pre-appointment hearings for John Griffith-Jones and Martin Wheatley?", WhatDoTheyKnow, December 2, 2013.
  36. ^ Inman, P., "Financial Conduct Authority director quit over insurance review fallout", The Guardian, December 16, 2014.
  37. ^ McLaughlin, Aimée (10 May 2017). "Financial Conduct Authority looks to streamline and simplify with rebrand". Design Week. Retrieved 29 February 2020.
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