The regulator has decreased the use of its power to force firms to appoint skilled persons to conduct business reviews, issuing 19 skilled person reports in the first half of this year.
Of the 19 skilled persons reviews, three were commissioned using the Financial Conduct Authority’s new power, introduced in the Financial Services Act 2012, to contract directly with a skilled person.
Of the latest figures, insurance companies were ordered to carry out six business reviews, followed by the securities and futures sector which was ordered to carry out five.
The latest figure suggests the FCA is not issuing as many as between April 2012 and March 2013, when the Financial Services Authority issued 113 review orders.
In the 2010 to 2011 financial year, there were 95 orders and this prompted a parliamentary question to be raised by conservative MP Mark Field over the costs the reviews place on the industry.
Mr Field called for a rethink of the powers as data showed that the cost to firms of conducting the reports that year totalled more than £32m.
In 2006 to 2007 firms had been issued with just 18 such orders at a cost of just £3.8m.
In February, the FSA consulted on proposed changes to its handbook that would allow firms to appoint its own skilled person and then charge the cost back to a firm.
The consultation paper, published on 8 February, proposed updating the handbook to bring it in line with planned Financial Conduct Authority policy regarding disciplinary powers, skilled persons reports, own-initiative powers and cancelling approval of primary information providers.
