Regulatory Law
Financial Advisers

We handle cases where independent financial advisers are being investigated by their regulatory body, the Financial Conduct Authority (FCA), and, in certain circumstances, the Prudential Regulation Authority (PRA).

The FCA Regulatory Process

In the United Kingdom, financial advisers are principally regulated by the Financial Conduct Authority (FCA), which is responsible for supervising authorised firms, maintaining standards of conduct and investigating suspected breaches of financial services legislation and regulatory requirements. The FCA operates under the Financial Services and Markets Act 2000 and its associated regulatory framework. Certain financial advisers are also subject to the Senior Managers and Certification Regime (SM&CR), under which authorised firms are responsible for assessing and certifying the fitness and propriety of employees performing specified functions, normally at least annually. Following reforms introduced in April 2026, certification may be carried out electronically and incorporated into existing appraisal procedures, with a proportionate approach to repeat assessments where appropriate.

Where concerns arise about a financial adviser or authorised firm, the FCA will initially assess whether the matter warrants formal investigation or other regulatory action. If an investigation is commenced, investigators may obtain documents, require information, conduct interviews and gather evidence from relevant individuals and organisations. The firm or individual concerned will normally be notified of the investigation, subject to the applicable statutory requirements and any circumstances justifying a different approach. Following the investigation, the FCA may decide to take no further action, pursue supervisory measures, seek a settlement, or commence formal enforcement proceedings.

Where formal enforcement action is proposed and the matter is not settled, the decision may be referred to the FCA’s Regulatory Decisions Committee (RDC), which operates separately from the investigation team. In certain cases, decisions are instead taken by authorised FCA staff under executive procedures. Where required, a Warning Notice will be issued setting out the proposed action and the reasons for it. The financial adviser or firm will normally have the opportunity to make written representations and, where applicable, oral representations, together with access to relevant material relied upon by the decision-maker, subject to statutory disclosure requirements.

After considering the evidence and any representations, the RDC or other authorised decision-maker may issue a Decision Notice setting out the action proposed and the reasons for the decision. Where the decision is not contested, the FCA will generally issue a Final Notice confirming the regulatory action taken. Alternatively, the firm or individual may refer an appealable decision to the Upper Tribunal (Tax and Chancery Chamber), which is independent of the FCA and may consider evidence that was not available to the original decision-maker. In disciplinary cases, the Tribunal determines what action the FCA should take, while in supervisory cases its powers are generally limited to dismissing the reference or remitting the matter to the FCA for reconsideration. Such references must normally be received within 28 days of receipt of the Decision Notice, although the Tribunal has power to extend the time limit in appropriate circumstances.

The FCA has a range of enforcement powers, including imposing financial penalties, issuing public censures, withdrawing regulatory approvals, restricting or suspending regulated activities, and making prohibition orders preventing individuals from performing specified functions or working in regulated financial services. In appropriate circumstances, the FCA may also pursue criminal proceedings. Where a matter is resolved through settlement, the FCA may apply a discount to certain financial penalties or time-limited restrictions. Under the current settlement scheme, a 30% discount is generally available where a qualifying full settlement is reached during stage 1 of the investigation, with reductions of up to 30% available in certain partly contested cases settled during the same stage. No settlement discount is normally available after stage 1, and permanent disciplinary prohibition orders do not attract a discount. Any disgorgement element of a financial penalty is also excluded from the discount.

Regulatory enforcement outcomes are generally made public through Final Notices. However, the FCA does not normally publicise ongoing investigations into regulated firms unless exceptional circumstances apply. Under its revised Enforcement Guide, effective from 3 June 2025, the FCA may also make announcements concerning suspected unauthorised activities, criminal offences relating to unregulated activities, investigations already made public by specified parties, or anonymised investigations in appropriate circumstances. These revised publicity arrangements apply to investigations commenced on or after 3 June 2025. The FCA has also discontinued the use of private warnings as an enforcement tool.

The PRA Regulatory Process

The Prudential Regulation Authority (PRA), which forms part of the Bank of England, is responsible for the prudential regulation of banks, building societies, credit unions, insurers and certain major investment firms. Although independent financial advisers are generally regulated by the FCA, PRA proceedings may be relevant to individuals working within firms that are subject to both regulators, particularly where senior management responsibilities or prudential regulatory requirements are involved.

Where the PRA investigates suspected regulatory breaches, evidence may be gathered from the relevant firm, individuals and other sources. If formal enforcement action is proposed, contested cases may be considered by the Bank of England’s Enforcement Decision Making Committee (EDMC), which operates independently of the investigation team. The firm or individual concerned may make written and oral representations and, where applicable, refer the resulting regulatory decision to the Upper Tribunal. Sanctions may include financial penalties, public censures, restrictions on regulated activities and other measures available under the applicable statutory framework.

Internal Disciplinary Proceedings

We also assist and represent financial advisers where they are the subject of internal disciplinary proceedings by their employer, including matters concerning regulatory compliance, professional conduct and assessments of fitness and propriety under the Senior Managers and Certification Regime.

What To Do If Regulatory Proceedings Are Commenced Against You

Should internal disciplinary proceedings or FCA or PRA regulatory proceedings be commenced against you, then please either telephone us on 0333 301 0700, or complete our questionnaire.