The Financial Conduct Authority has said it accepts the criticisms made by the regulatory watchdog about its supervision of a firm and defended its role in policing the financial sector.
Yesterday (3 March) FTAdviser reported that Complaints Commissioner Antony Townsend had upheld a complaint against the FCA and said it was a matter of "considerable concern" the regulator had intelligence about the unnamed firm from several sources for more than six months without taking action.
In a statement, the FCA said it accepts Mr Townsend's criticisms about this case and said it made changes to its approach to supervision last month when it published a consultation on this issue.
The FCA also said it will review whether its factsheet remains relevant following the changes in its supervisory approach.
It said: "The FCA supervises around 58,000 firms serving retail and wholesale consumers as well as users of many of the world’s largest and most significant global markets. These firms vary greatly in size, complexity and in the risks of harm they pose to consumers and market integrity.
"To make the best use of our resources and deliver the greatest public value, the FCA takes a proportionate approach to supervising firms.
"The FCA makes use of information from a wide range of sources – this includes feedback from consumers and consumer organisations, data and intelligence from firms and their trade associations, insight shared by other regulatory organisations, information from MPs and from whistleblowers. This enables the FCA to identify problems rapidly and, where necessary, intervene swiftly to address harm to consumers or markets."
In a damning ruling, Mr Townsend said he believed the case represented wider problems in the FCA's supervision of firms being carried out with a "lack of curiosity or sense of urgency", claims the regulator denied.
The FCA received intelligence about the firm, which was alleged to be defrauding investors, in January 2017 but it was not assessed until around 2 June 2017 when a caseworker in training was assigned.
In June the FCA decided to use its powers under section 165 of the Financial Services & Markets Act to obtain information from the firm, but it was not until November 2017 that the regulator actually took steps to act on these powers.
According to the FCA's file, during this period so-called "project work" was prioritised and some staff were off sick.
damian.fantato@ft.com
