UK FCA publishes first issue of Enforcement Watch

The FCA’s Enforcement Watch is intended to act as an educational and deterrent tool for UK financial services firms. 

What does the first issue cover?

The first issue covers the FCA’s:

1. updated publicity policy in action.  
2. Enforcement case priorities.  
3. international partnerships.

1. Updated publicity policy in action

In June 2025, the FCA published its updated Enforcement Guide in which it amended its publicity policy. See our previous article here. 

Under its updated publicity policy the FCA can:

• ·name a firm or individual subject to an Enforcement investigation under its “exceptional circumstances” test.  This test was retained from the FCA’s previous policy.
• reactively announce an investigation where it is already in the public domain.
• announce an investigation on an anonymous basis.
• ·name an unauthorised firm under investigation if desirable to warn consumers or help the investigation. 

The FCA says that, between 3 June and 31 December 2025, it opened 23 Enforcement operations, and it sets out its stance on publicity in relation each one: 

• Six investigations relate to individuals. The FCA says that the bar for announcing an investigation into an individual is high, and none of these have so far met that bar.
• The FCA has confirmed three investigations into listed issuers following an announcement by the firm itself. These are the investigations into John Wood Group plc, Drax Group plc and WH Smith plc.
• Two investigations relate to unauthorised business activity. The FCA has decided not to announce these investigations yet for operational reasons, however it is keeping things under review.
• 12 operations relate to authorised firms. Of these, the FCA decided that its investigation into The Claims Protection Agency Limited (“TCPA”), a motor finance claims management company, met its “exceptional circumstances” test and, hence, the FCA made a named announcement. TCPA had filed a judicial review challenging the FCA’s decision to name it, which was dismissed by the Administrative Court. See our previous article here.
• The FCA has confirmed investigations into two insurers in the home and travel markets, without naming them.
• In the remaining operations, the FCA considered the exceptional circumstances test but it did not think the threshold had been met in these cases. However, it is keeping the position under review.   

2. Enforcement case priorities

The 23 Enforcement operations cover a wide range of suspected misconduct:  

• 18 operations are investigating regulatory breaches.  
• Four consider criminal and regulatory offences.
• In one, the FCA is only investigating criminal offences.  

They include investigations into: 

• Individual responsibility: The FCA is investigating individuals’ potential responsibility for regulatory failings, such as providing false information to the FCA, suspected fraud and misappropriation of funds. 
• Listed issuers: The FCA is investigating potential market disclosure issues.
• Unauthorised business: The FCA is investigating suspected unauthorised business, particularly in the cryptoasset sector, where entities provide cryptoasset services while not registered under the Money Laundering Regulations. The FCA warns that firms that provide services to other financial institutions should check that their customers hold the requisite permissions to undertake the activities they offer.
• Fair value: The FCA is investigating six potential Consumer Duty breaches by firms, particularly in relation to fair value for consumers, two of which concern insurance firms, which were the most serious cases identified by the FCA in its multi-firm work.  In some Consumer Duty cases, the FCA has used supervisory tools, including voluntary or own initiative requirements, to protect consumers while investigations continue.
• Inadequate oversight: The FCA is investigating suspected systems and controls failings, where authorised firms may have caused harm through inadequate oversight of systems or relying on third party providers that did not meet required standards.  The harm caused in these cases includes customers who were unable to access information about their accounts, who experienced delayed responses to complaints or who faced mishandled claims.
• Adequacy of controls: The FCA is investigating concerns around the adequacy of firms’ financial crime controls.
• Consumer investment and asset management: The FCA is investigating five firms in the consumer investment and asset management sectors, looking into suspicions of misleading consumers and third parties with false statements and failing to recognise conflicts of interest.

3. International partnerships

The FCA talks about its membership of the International Organisation of Securities Commissions (“IOSCO”), which is an association of securities regulators from around the world aimed at improving information-sharing and co-ordination. 

The FCA says that global partnerships such as this are extremely valuable to its cross-border investigations, as they enable the FCA to quickly get hold of information from around the world to build its cases, including witness statements, banking records, transaction data and communication records (such as its investigation into BlueCrest). In return, the FCA provides support to other regulators.

The IOSCO framework complements the FCA’s international information-gathering tools via mutual legal assistance channels and the Crime (Overseas Production Orders) Act (“COPO”).  In criminal investigations, the FCA now receives electronic data from service providers based in the US much faster by getting court orders in the UK through COPO, which can then be served direct on providers in the US. Before, it could take over a year to get this kind of information via other mutual legal assistance channels but, with COPO, it takes a few weeks. In 2025, the FCA successfully made several requests via this route to support ongoing market abuse work and will use this across its criminal portfolio where relevant.

What can firms learn?

What lessons can firms take from the FCA’s first Enforcement Watch?

What is clear is that, despite the FCA’s recent pronouncements that it is opening fewer Enforcement investigations and reserving Enforcement for those cases which drive “impactful deterrence” across the industry, there in fact appears to be a slight uptick in case openings.  The FCA’s Enforcement Data 2024/25 reveals that the FCA opened 23 Enforcement operations in the period 1 April 2024 to 31 March 2025, but the data included in Enforcement Watch reveals that it has opened 23 operations in the period 3 June to 31 December 2025.

As can be seen, the FCA has decided to name a claims management firm under investigation in line with its “exceptional circumstances” test.  In other investigations where the firm has not been named, the FCA makes the point that it is “keeping the position under review”.  Firms are reminded that FCA’s decision to name a firm is not a one-off decision at the outset of an investigation but the FCA can do this at any time if it considers its exceptional circumstances test to have been met.

In relation to the misconduct being investigated, it appears that the FCA’s patience with firms’ compliance with the Consumer Duty may be beginning to wear thin, as it has opened six investigations in relation to the Duty, specifically in relation to fair value.  The FCA says that the two most serious cases were identified through its multi-firm work, demonstrating that FCA reviews are not as benign as they may initially appear to be, and may lead to Enforcement.

Given the FCA sees the publication of this new bulletin as a tool which both educates firms and encourages compliance with its rules, Enforcement Watch should become essential reading for compliance teams in UK financial services firms.

If you have any questions about this article or any of the issues raised, please get in touch with your usual contact at Hogan Lovells, or any of the contacts listed. 

Authored by Daniela Vella.