The FCA’s streamlined Enforcement Guide: how significant are the changes?

The FCA recently published its consolidated and streamlined Enforcement Guide (ENFG) last week, which is effective from 3 June 2025.
 

Revised investigation publicity policy

Much of the focus has been on the FCA’s revised publicity policy following its controversial proposals on this topic last year. The FCA has now confirmed and codified (in the new ENFG) its final position on this. It is retaining its existing exceptional circumstances policy as the principal test to decide if it should publicise an investigation into a regulated firm.

In addition, the FCA may publicise investigations in the following three circumstances:

1. Announcements for suspected unauthorised financial services/criminal offences related to unregulated activity

• The FCA have confirmed that this will include investigations into suspected breaches of the financial promotions regime.
• The rationale is that the announcement could prevent further harm by highlighting or warning consumers and investors about the firm in question and may aid the FCA’s investigation by encouraging witnesses to come forward.

2. Reactive confirmations where information is already in the public domain

• This will allow the FCA to confirm that it is investigating a subject in circumstances where the subject of the investigation, an associated firm, or another regulatory, government, or public body has already publicised it. The purpose is to avoid any public misunderstanding about the action the FCA is taking.

3. Publish anonymised information about investigations

• This will enable the FCA to publicise that it is investigating a particular matter without naming or identifying the subject firm when it considers that doing so would have a deterrent or educational effect.
• The purpose is to assist firms by helping them understand areas of conduct that are subject to active enforcement and promote compliance with FCA rules in those area(s). 

The FCA will not generally announce investigations into named individuals, except in rare cases where necessary.

The FCA acknowledges in its Policy Statement the widespread concerns about its original proposals to name regulated firms under investigation where a public interest test was met. While the FCA has reflected this feedback in its revised publicity policy, it makes it clear in the Policy Statement that its views on its original proposals remain largely unchanged. 

The FCA has been heavily criticised for the time taken to amend its proposals and to bring an end to this matter. In our view, it is pleasing to see the extent to which the FCA engaged with the industry during the consultation process, including one-to-one meetings with industry representatives and roundtables organised by advisers. This interactive approach is welcomed and marks a notable step change in approach.

What impact will the revised publicity policy have?

The FCA’s power to share information on anonymised basis has the potential to significantly enhance the transparency of its enforcement activities. Many respondents to the consultation process were in favour of the FCA publishing a regular enforcement bulletin summarising themes arising from its investigations. The FCA has not yet reached a decision on this, stating in the Policy Statement that it is “exploring ways of sharing information on a general basis, looking at how [it] might provide more information on themes and trends in [its] enforcement work”.

There is a careful balance to strike in sharing information on an anonymised basis. While enhanced transparency is welcomed, if it is too specific it may lead to attempts being made by third parties to track down the identities of investigation subjects and to public misconception.

The FCA is a self-professed data-led regulator and we would therefore expect it to monitor the effectiveness of its updated enforcement policy through the assessment of enforcement statistics.

The FCA has stated that it will assess the impact of its revised publicity policy by tracking the reasons for whistleblower disclosures and witnesses coming forward, and public and industry confidence in its enforcement work via surveys.

In addition, the FCA plans to report annually on the number of cases where it shares information about an investigation and then takes no further action. This stems from a concern raised in response to the original proposals that, according to the FCA’s own statistics, at the time of the first part of the consultation process (February 2024) 65% of enforcement cases opened were closed without further action. There appears to be a marked improvement since April 2023, with the FCA noting in the Policy Statement that none of the investigations it has opened into FCA authorised firms since April 2023 have closed without further action. 

The next few months will prove an interesting test for how this will develop in practice. We will be keeping a watching brief.

The updated Enforcement Guide

The revisions made to the ENFG should not be overlooked. While the revisions are primarily intended to remove outdated, duplicative and/or legislative content in order to make the document more concise and accessible, there are some subtle (and easy to miss) changes in policy which could be quite impactful for the subjects (or potential subjects) of FCA enforcement investigations. 

Those signposted in the Policy Statement are:

• Accepting firm commissioned reports on a limited waiver basis – this has formalised the approach the FCA has taken for some time that it will accept these reports on a limited waiver basis but without: (i) agreeing the extent to which they are legally privileged; or (ii) accepting any condition that restricts the FCA’s ability to use the information.
• Attendance of legal advisers at compelled interviews – the ENFG now allows the enforcement case team to determine whether to refuse the attendance of a legal adviser (other than the interviewee’s own legal adviser) on the basis of potential prejudice to the investigation or any other ongoing investigation. This change was made despite feedback noting that legal advisers have their own professional obligations to avoid conflicts of interest.
• Reporting on investigations – the ENFG has removed private warnings and preliminary finding letters as enforcement tools. The feedback that the FCA received was generally in favour of this but some respondents were of the view that these documents were useful in reducing the amount of detail to be included in warning notices.
• Clarification that scoping meetings are optional – the FCA has confirmed that the necessity for a scoping meeting will be determined on a case-by-case basis at the start of the investigation. This is a consolidation of existing FCA practice despite some respondents providing feedback that there are benefits to having these meetings in all cases.
• Expanding the population of senior FCA personnel who can determine whether to start civil and criminal enforcement proceedings – this has been broadened to include Directors as well as Executive Directors in the Enforcement division.

There is also a large amount of material which has been relocated from the ENFG to the FCA’s website and/or de-duplicated where the primary source is legislation or a different part of the FCA’s Handbook. This means that anyone seeking to find information about FCA enforcement powers and policy will need to check multiple sources in order to ensure that they have the full detail. Examples include:

• details about the FCA’s approach to case selection and prioritisation as well as their policy on interactions with other authorities are now provided as links to the FCA’s website;
• guidance on the approach to the FCA’s use of its supervisory intervention powers to impose a variation, cancel a permission, impose requirements on its own initiative and intervene against incoming firms has been moved to SUP 6B;
• details about Regulatory Decision Committee processes that were previously included in Chapter 14 are now only in DEPP; and
• details about the FCA’s financial penalty scheme and settlement processes are now only in DEPP.

Please contact us if you would like to discuss the new ENFG in further detail.