Financial crime the focus of FCA enforcement

Jonathan Cavill and Anthony Harrison of Pinsent Masons, who support financial services firms with contentious regulatory cases, investigations and remediation, were commenting after the FCA confirmed that its enforcement unit opened 33 new operations in the financial year 2025/26 ended 31 March, compared to 23 in 2024/25. Those operations can cover regulatory or criminal investigations, or a mix of the two, as well as civil proceedings.

The FCA said 75% of its enforcement work focuses on fighting financial crime and at least half of its operations involve investigating potential criminal offences.

Cavill said: “Although there is a focus on prompt enforcement action in a limited number of investigations, the FCA's remit is widening, to include claims management company investigations and novel issues around cryptoassets, for example. This means early settlement is likely to be attractive to the FCA if there is a saturated enforcement workload.”

Despite the increase in new cases, the FCA data shows that, for the operations it closed during 25/26, the regulator took enforcement action in fewer cases – 20 – compared to the year before, when it took enforcement action in 34 cases. The number – and total value – of financial penalties it levied fell year-on-year too, as did the number of final notices it served and prohibitions it imposed. However, the FCA secured more than three times the number of criminal convictions in 25/26 – 17 – than the five recorded for 24/25.

Most of the enforcement work undertaken by the FCA does not involve formal investigations or sanctions addressing backwards-looking failures by firms. Rather, it is focused on intervention to identify harm early and ensure corrective action is taken.

According to the data, the FCA opened 265 new intervention cases in 25/26, up from 260 in 2024/25. The interventions team supported 137 outcomes in 2025/26, the bulk of which involved firms meeting voluntary requirements (92) or making undertakings (25) to the regulator. In 10 cases, known as ‘own initiative’ cases, the FCA used formal powers without the agreement of the firm or individual to achieve the outcomes.

One of the tools the FCA can use to understand whether firms are meeting their compliance obligations is to trigger a ‘skilled person review’ – an independent expert assessment of a firm and its operations – using powers it has under Section 166 (s166) of the Financial Services and Markets Act 2000.

Earlier this summer, Rathbones disclosed that the FCA had exercised its powers to commission a ‘skilled person review’ into its business. However, data on the use of skilled person reports shows an overall reduction in their use by the FCA in 25/26. The FCA used its skilled person powers in 31 cases during the year, compared with 47 times the year before, 83 times in 23/24 and 47 times in 22/23.

“This is unlikely to be indicative of a soft supervisory approach, more reflective of a more forthright approach from the FCA’s supervision team generally to intervene and investigate without needing to commission an official s166 skilled person review,” said Harrison.

In 25/26, the FCA secured an estimated £82.1 million for consumers and investors through redress schemes, settlements and civil proceedings. This is down on the estimated £442.3m it secured in 24/25. Cavill and Harrison said comments made in recent years by Therese Chambers, joint executive director of enforcement and market oversight at the FCA, highlight the regulator’s expectation that firms act voluntarily and proactively to provide redress to consumers that suffer losses owing to non-compliance – and that the regulator will act to achieve redress if they do not do so.