London Daily

Focus on the big picture.
Thursday, Jul 10, 2025

Britain's financial watchdog reveals plan to bolster consumer protection

Britain's financial watchdog on Friday proposed new "consumer duty" rules for financial services to protect people from scams and mis-selling, which have tarnished the industry for decades.
Retail investors in Britain have suffered from mis-sold financial products, including endowment mortgages, pensions and payment protection insurance. Taxpayers are also having to help investors who suffered losses after the collapse of London Capital & Finance (LCF) investment firm.

The Financial Conduct Authority is proposing that financial services firms, which currently have an obligation to treat customers "fairly", would in future explicitly have to act in the best interest of retail customers when selling products or services, or act to deliver good outcomes. The wording will be finalised after a public consultation that closes in July.

This would require a significant shift in culture and behaviour for many firms who would have to demonstrate they took "all reasonable steps" to avoid foreseeable harm to their customers, the FCA said.

However, it stops short of the stronger statutory duty of care called for by some stakeholders to allow consumers to sue financial firms for redress.

Consumers currently must rely on the Financial Services Ombudsman, which was unable to compensate many LCF investors.

Under the proposed rules, firms that do no comply could face enforcement action.

Firms involved in making and supplying financial products and services would also be covered by the new rules, even if they are not in direct contact with the end customer, the FCA said.

Simon Morris, partner at CMS law firm, said the proposals mostly repackage current rules and policies for greater impact after the FCA was stung by LCF and other high-profile failures of supervision.

But if the option of forcing firms to deliver good outcomes was selected it would be a "toxic formula for creating undeliverable expectations", Morris said.

Sheldon Mills, the FCA's executive director for consumers and competition, said the measures were significant, though he recognised there was a debate to be had over whether it would be enough.

The watchdog is also consulting on the potential benefits of attaching a "private right of action" to the new duty to allow consumers to sue in court.

Any new rules would be drawn up by July 2022.
Newsletter

Related Articles

0:00
0:00
Close
Severe Heatwave Claims 2,300 Lives Across Europe
NVIDIA Achieves Historic Milestone as First Company Valued at $4 Trillion
Declining Beer Consumption Signals Cultural Shift in Germany
Linda Yaccarino Steps Down as CEO of X After Two Years
US Imposes New Tariffs on Brazilian Exports Amid Political Tensions
Azerbaijan and Armenia are on the brink of a historic peace deal.
Emails Leaked: How Passenger Luggage Became a Side Income for Airport Workers
Polish MEP: “Dear Leftists - China is laughing at you, Russia is laughing, India is laughing”
BRICS Expands Membership with Indonesia and Ten New Partner Countries
Weinstein Victim’s Lawyer Says MeToo Movement Still Strong
U.S. Enacts Sweeping Tax and Spending Legislation Amid Trade Policy Shifts
Football Mourns as Diogo Jota and Brother André Silva Laid to Rest in Portugal
Labour Expected to Withdraw Support for Special Needs Funding Model
Leaked Audio Reveals Tory Aide Defending DEI Record
Elon Musk Founds a Party Following a Poll on X: "You Wanted It – You Got It!"
London Stock Exchange Faces Historic Low in Initial Public Offerings
A new online platform has emerged in the United Kingdom, specifically targeting Muslim men seeking virgin brides
Trump Celebrates Independence Day with B-2 Flyover and Signs Controversial Legislation
Boris Johnson Urges Conservatives to Ignore Farage
SNP Ordered to Update Single-Sex Space Guidance Within Days
Starmer Set to Reject Calls for Wealth Taxes
Stolen Century-Old Rolls-Royce Recovered After Hotel Theft
Macron Presses Starmer to Recognise Palestinian State
Labour Delayed Palestine Action Ban Over Riot Concerns
Swinney’s Tax Comments ‘Offensive to Scots’, Say Tories
High Street Retailers to Enforce Bans on Serial Shoplifters
Music Banned by Henry VIII to Be Performed After 500 Years
Steve Coogan Says Working Class Is Being ‘Ethnically Cleansed’
Home Office Admits Uncertainty Over Visa Overstayer Numbers
JD Vance Questions Mandelson Over Reform Party’s Rising Popularity
Macron to Receive Windsor Carriage Ride in Royal Gesture
Labour Accused of ‘Hammering’ Scots During First Year in Power
BBC Head of Music Stood Down Amid Bob Vylan Controversy
Corbyn Eyes Hard-Left Challenge to Starmer’s Leadership
London Tube Trains Suspended After Major Fire Erupts Nearby
Richard Kemp: I Felt Safer in Israel Under Attack Than in the UK
Cyclist Says Police Cited Human Rights Act for Riding No-Handed
China’s Central Bank Consults European Peers on Low-Rate Strategies
AI Raises Alarms Over Long-Term Job Security
Saudi Arabia Maintains Ties with Iran Despite Israel Conflict
Musk Battles to Protect Tesla Amid Trump Policy Threats
Air France-KLM Acquires Majority Stake in Scandinavian Airlines
UK Educators Sound Alarm on Declining Child Literacy
Shein Fined €40 Million in France Over Misleading Discounts
Brazil’s Lula Visits Kirchner During Argentina House Arrest
Trump Scores Legislative Win as House Passes Tax Reform Bill
Keir Starmer Faces Criticism After Rocky First Year in Power
DJI Launches Heavy-Duty Coaxial Quadcopter with 80 kg Lift Capacity
U.S. Senate Approves Major Legislation Dubbed the 'Big Beautiful Bill'
Largest Healthcare Fraud Takedown in U.S. History Announced by DOJ
×