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What does FCA do?

Published in Financial Regulation 2 mins read

The Financial Conduct Authority (FCA) protects consumers and the integrity of the UK’s financial system by regulating financial firms and markets.

FCA's Core Functions

The FCA, as an independent public body, primarily focuses on the following activities, using fees paid by regulated firms:

  • Consumer Protection: The FCA aims to protect consumers by ensuring that financial firms treat them fairly. This includes setting standards for products and services, providing information to consumers, and taking action against firms that do not meet these standards.

  • Maintaining Market Integrity: The FCA works to ensure that financial markets operate fairly, efficiently, and honestly. This involves monitoring market activity, investigating potential misconduct, and taking enforcement action when necessary.

  • Promoting Competition: The FCA seeks to promote effective competition in the interests of consumers. This includes removing barriers to entry for new firms, encouraging innovation, and ensuring that firms do not engage in anti-competitive practices.

Powers Utilized by the FCA

The FCA is vested with significant powers to achieve its objectives. These include:

  • Authorization: The FCA authorizes firms to conduct regulated financial activities.
  • Supervision: The FCA supervises firms to ensure they comply with its rules and standards.
  • Enforcement: The FCA uses criminal, civil, and regulatory enforcement powers to act against firms and individuals that are not authorized. This can include fines, public censure, and the removal of individuals from the financial services industry.

In summary, the FCA plays a crucial role in maintaining a healthy and trustworthy financial system by regulating firms, protecting consumers, and ensuring market integrity.