FCA 'very different regulator' as it accepts failed firm claims

FCA 'very different regulator' as it accepts failed firm claims

The Financial Conduct Authority has said it is a “very different regulator” now than in 2018 as it responded to complaints about a payment services firm.

In a statement on Friday (August 19), the FCA said it had upheld or partially upheld five out of 31 allegations made against it over the collapse of Premier FX.

The allegations relate to the timeliness and accuracy of updates made to the FCA’s register, it said, including the reauthorisation of the company just before it collapsed, and concerns over how information was handled and “not actioned”.

Article continues after advert

Premier FX, which collapsed in 2018, was regulated by the FCA for money transfers, but it did not have permission to accept deposits.

The company encouraged British customers in the UK, as well as expats in Portugal and Spain, to deposit their savings with it, hoping to benefit from exchange rates.

However, it was put into liquidation and customers who put money into the company were not covered by the Financial Services Compensation Scheme as it was not regulated to be a deposit-taker.

In the statement last week, the FCA said it has largely remediated the issues identified, including a “single view of firms” dashboard which allows information to be shared across the organisation. 

An FCA spokesperson said: 'We recognise that the collapse of Premier FX resulted in the loss of significant sums of money for its customers.

"We are very sorry for the mistakes we made prior to the collapse of Premier FX.

“We are a very different regulator today than we were during the period that these complaints cover.”

The spokesperson added that complaints like those about the regulation of Premier FX provide a “vital source of insight”, which has led to improvements to the processes and working practices of the regulator.

In its investigation into Premier FX’s insolvency, the regulator said it had identified serious misconduct by the company and its bankers, Barclays Bank.

Barclays was fined £783,800 for the failings, and contributed £10mn to refund 167 of Premier FX’s clients who had their claims to the company’s liquidators accepted. 

The FCA said Barclays failed to make enquiries to ensure Premier FX’s business activity aligned with its expectations, and did not identify that the company’s internal controls were deficient.

“This constituted a failure by Barclays to conduct its business with due skill, care and diligence.”