Financial Conduct Authority

The Financial Conduct Authority (FCA) regulates the financial services industry in the UK, and it has the sole aim of ensuring that markets run efficiently and fairly. It does so by monitoring the activities of trading brokers and a variety of other firms in the sector that offer products to the consumer, including banks, building societies and credit unions, to ensure that only the highest of standards are observed. The FCA works independently of the government, and its work is financed by charging fees to members from within the financial services sector. Formed in 2013 and superseding the Financial Services Authority, the organisation preserves the integrity of an industry worth approximately £65.6bnto the UK economy each year.

Regulatory areas and powers

In 2012, the Retail Distribution Review (RDR) was the catalyst for a number of new rules for independent financial advisers to abide by. If an organisation is defined as one that offers a “broad range of retail investment products” and “gives consumers unbiased and unrestricted advice based oncomprehensive and fair market analysis”, then it falls under the remit of the legislation set out by the FCA. The FCA has considerable powers in the regulation of the financial markets sector. It specifies its minimum standards of service, and firms that don’t meet the protocol are not given FCA approval – crucial in determining which trading brokers in the UK are legitimate or otherwise. The FCA also has investigative powers and will challenge organisations that are believed to be acting in a way that is counter to its standards. The regulator will also follow up complaints from members of the public about how a financial services provider is operating. Punishments available where breaches are confirmed include the power to demand that the operator rectifies the issue immediately, the freezing of assets, and the handing out of indefinite bans from trading. The FCA governs the whole of the retail investment sector, which includes commodities trading, investments in stock, bonds and endowments, CFDs and spread betting, national saving schemes and much more.

How to check if a broker is regulated by the FCA

Members of the public should check that a broker or retail investments firm is approved by the FCA before parting with any money, because investments with unauthorised firms are not covered by the Financial Services Compensation Scheme (FSCS).You can check the register of approved companies by visiting and using the company search function. Not only does the register reveal which companies are currently regulated by the FCA, but it also shows which organisations have been regulated by the FCA in the past but are no longer regulated byit.If a financial services provider claims to be FCA approved but does not appear on the register, then you can contact the regulator’s helpline on 0800 111 6768.

Making a complaint to FCA

The FCA has a four-step process in place for making a complaint about one of its regulated firms. You should contact the company directly in the first instance, as all FCA-approved operators have a dispute resolution system in place. Written complaints have to be responded to within eight weeks.If you are not satisfied with how your complaint is handled, then you can forward your grievances to the Financial Ombudsman Service or use the services of an independent complaints management provider.Step four, to be avoided where possible, is taking your claim to court. If you wish to make a complaint about an unauthorised firm, then you can contact the FCA’s consumer helpline for more assistance.

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