What's happened
The UK's Financial Conduct Authority (FCA) will extend its bullying and harassment rules to over 37,000 financial firms starting September 2026. This move aims to address non-financial misconduct and prevent individuals from evading accountability by switching firms. The decision follows a significant rise in misconduct claims across the sector.
What's behind the headline?
Overview
The FCA's expansion of misconduct reporting is a significant step towards enhancing accountability in the financial sector. By including a broader range of firms under the Senior Managers and Certification Regime (SM&CR), the FCA aims to tackle the issue of 'rolling bad apples'—individuals who move between firms without facing consequences for their actions.
Implications
- Cultural Shift: The FCA's deputy chief executive, Sarah Pritchard, emphasized that unchecked bullying and harassment are indicators of deeper cultural issues within firms. This initiative seeks to foster a culture of accountability and transparency.
- Consistency Across Firms: Aligning conduct rules for banks and non-banks will provide a clearer framework for firms to address misconduct, potentially leading to more robust internal policies.
- Future Challenges: While the rules will not apply to certain sectors like payments and e-money firms, the FCA's approach may prompt these sectors to adopt similar standards voluntarily.
Conclusion
The implementation of these rules is expected to reshape the landscape of financial services in the UK, promoting a safer and more accountable environment. As firms prepare for these changes, the focus will likely shift towards developing comprehensive strategies to manage and report misconduct effectively.
What the papers say
According to The Guardian, the FCA's new rules will require serious cases of misconduct to be reported across a wider range of firms, aiming to prevent individuals from evading accountability. Sarah Pritchard stated, "Behaviour like bullying or harassment going unchallenged is one of the reddest flags."
Bloomberg highlighted a 72% surge in non-financial misconduct claims, linking it to high-profile scandals, including allegations against Crispin Odey and Jes Staley. This context underscores the urgency of the FCA's regulatory changes.
The Independent noted that the FCA is seeking stakeholder feedback on the implementation of these rules, indicating a collaborative approach to refining the guidelines. This consultation process will be open until September 10, 2025, allowing firms to voice their concerns and suggestions.
How we got here
The FCA's decision comes in response to a 72% increase in non-financial misconduct claims over three years, driven by high-profile scandals. Previously, only banks were required to report such misconduct, leaving a gap in accountability across other financial institutions.
Go deeper
- What types of misconduct will be reported?
- How will firms prepare for these new regulations?
- What impact will this have on the financial industry?
Common question
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What Are the New Misconduct Rules from the FCA and How Will They Affect You?
The Financial Conduct Authority (FCA) is set to implement new misconduct rules that will impact over 37,000 financial firms in the UK. As these changes roll out in September 2026, many are left wondering how this will affect the financial landscape and what prompted such significant regulatory shifts. Here are some common questions and answers regarding these new rules.
More on these topics
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The Financial Conduct Authority 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.
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The United Kingdom of Great Britain and Northern Ireland, commonly known as the United Kingdom or Britain, is a sovereign country located off the northÂwestern coast of the European mainland.
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James Edward "Jes" Staley, is an American banker, and the group chief executive of Barclays. Staley has nearly four decades of experience in banking and financial services. He spent 34 years at J.P. Morgan's investment bank, ultimately becoming CEO.