What is the Financial Conduct Authority?

The Financial Conduct Authority (FCA) is an independent public body that regulates the financial services and markets in the UK. It aims to protect consumers, maintain the integrity of the industry, and promote competition.

Ruth Jackson-Kirby, Kristina Fox Last updated on 31 August 2022.
What is the Financial Conduct Authority?

The Financial Conduct Authority (FCA) was created in 2013, taking over from the Financial Services Authority to regulate financial services, firms and markets so that consumers are treated fairly. Here’s everything you need to know about the FCA.

What is the Financial Conduct Authority?

The Financial Conduct Authority (FCA) regulates financial activities, such as banking and insurance. The organisation sets down rules that firms must follow to offer consumers a fair experience.

It is an independent body funded by the 50,000 firms that it regulates.

What does the FCA do?

The FCA has the power to enforce the rules laid down to govern the financial services industry. In practice, the FCA investigates and acts when a business or individual is suspected of breaking the rules. The body also decides which firms are allowed to trade in financial services.

The FCA has the power to force firms to withdraw or change products, such as pensions, credit cards or investments, if they don’t meet the minimum standards set for that product.

Banks and other financial institutions are supervised by the FCA to ensure they are treating their customers fairly, operate safely, and are competing fairly.

How does the FCA protect consumers?

The FCA aims to protect consumers by making sure that FCA-authorised companies do the following:

  • Treat their customers fairly.
  • Provide them with appropriate products and services.
  • Value their customer’s safety above their own profit or income.

It does this by carefully checking firms before they are authorised and then supervising how firms operate.

If an FCA-authorised company or individual is thought to be breaking its rules, the FCA will intervene. If its suspicions are proved correct, then the FCA has the power to stop them trading, fine them, impose penalties and seek compensation for any consumers affected by the issue.

The FCA also works to raise consumer awareness of financial scams. It does this through, for example, its ScamSmart campaign that highlights scams involving investments and pensions.

It also produces a Warning List, which is updated daily, alerting consumers to firms that operate scams and lists firms that operate financial scams on its Financial Services Register, also known as the register.

If you are contacted by an unauthorised firm trying to involve you in a financial scam, you should report it to the FCA so it can be added to the warning list. You can do this by contacting the FCA by phone, via the online form on the FCA website, or by emailing.

What is FCA regulated?

All UK firms performing regulated duties, such as investment firms and consumer credit companies, must be registered and authorised by the Financial Conduct Authority.

To be authorised, a company must meet the FCA’s required standards. Once authorised, a firm can be investigated by the FCA if it is thought it isn’t meeting these standards. The FCA has the power to order authorised firms to stop trading, bring prosecutions against them and get compensation for consumers.

What is the FCA register?

If a company is regulated by the FCA, or has been in the past, it will appear on the FCA register. You can search the register to find out more information about a financial firm including its contact details, what it is authorised to do and whether it is covered by the Financial Ombudsman Service and the Financial Services Compensation Scheme.

The register also lists firms that are offering financial products or services without the necessary authorisation. This includes firms that are operating financial scams. These firms are clearly marked on the register.

You can search the register by looking up a name, reference number or postcode.

It is a good idea to check the FCA register before you engage with a new company or individual operating in the financial services industry. This will tell you if the company is regulated, in which case it must adhere to the FCA’s strict rules.

Checking the FCA register may also alert you to a scam. However, only scam firms that the FCA is already aware of appear on the register. If the firm you are looking for isn’t on the register, that doesn’t mean it isn’t operating a scam. It just means it isn't authorised by the FCA, which may be unaware of the scam.

Image source: Getty Images

About the authors:

Ruth is a freelance journalist with 15 years of experience writing for national newspapers, magazines and websites. Specialising in savings, investments, pensions and property. Read more

Kristina is a writer at NerdWallet. A recent graduate trading French for finance, she has experience creating content for student newspaper Cherwell and an edtech company. Read more

If you have any feedback on this article please contact us at [email protected]