FCA fails to meet target for completing investigations into complaints in 2019/20

Maria Nikolova

There has been a sharp increase in complaint volumes which has challenged the team’s capacity to meet demand, the UK regulator says.

The UK Financial Conduct Authority (FCA) today posted data about its performance in a range of areas for the period from April 1, 2019 to March 31, 2020.

Some of the areas the FCA has improved compared to last year include responding to letters from firms. The regulator responded to 98.7% of letters from firms within 5 working days, compared to 91.9% in 2018/2019 increasing the satisfaction score for consumer correspondence to 80% (up from 78% in 2019 and 79.3% in 2018) and meeting this target for the first time in over 2 years.

However, there are areas where the regulator still needs to improve. This includes the response rate when completing an investigation into a complaint. For complaints dealt with by the local business area, the FCA target is to complete an investigation and send a response to the complainant within 10 working days. The FCA has set a voluntary target of meeting this timeframe for 95% of cases. But there has been a sharp increase in complaint volumes which has challenged the team’s capacity to meet demand. As a result, the FCA has seen a sharp decline in this standard, only achieving 79.1% in 2020 compared with 96.6% in 2019.

There is still room for improvement with regard to the response rate to Freedom of Information Act (FOIA) requests. FCA’s statutory target is to respond to 90% of requests within 20 working days and in 2020 the response rate dropped from 88.5% in 2019 to 84.6% this year. The FCA received a total of 803 requests in 2020 (up 13% on the previous year’s total), resulting in some delays in responding in the second half of the year.

The regulator also lagged behind targets when it comes to processing an application for ‘approved person’ status for Customer Function (CF) and Significant Influence Function (SIF) roles. The FCA saw a large decline in processing applications for CF and SIF roles within target, dropping from 83.9% in 2019 to 56.6% this year, which is below FCA’s voluntary target of 85%. This was due to a significant number of solo-regulated firm applications the FCA received before the Senior Managers Regime for solo-regulated firms commenced. This level was over and above the expected level of conversion activity.

Another area where the FCA failed to meet its target in 2019/20 is the processing of a complete notification for appointed representative status. The regulator also saw a decline in processing these notifications within target this year, dropping from 96.6% in 2019 to 84.2% this year. This means that the FCA has fallen below its voluntary target of 95%. The time taken to process appointed representative notifications was affected by the work to deal with the significant number of solo regulated firm-related applications the FCA received before the start of the Senior Managers & Certification Regime (SM&CR) in December 2019, which was over and above the expected conversion activity.

Overall, the FCA achieved its SLA targets on 45 of its standards (75%) this year which is the same as in 2019. The regulator has, however, seen an increase in the number of standards reporting below its minimum targets. In 2019, it had 2 (3.3%) standards reporting below its minimum targets compared to 7 (11.7%) in 2020.

Read this next

Retail FX

Italian watchdog red flags Olympus Brokers, UnicoFX and Allfina Group

Italy’s Commissione Nazionale per le Società e la Borsa (CONSOB) has shut down new websites in an ongoing clampdown against firms it accuses of illegally promoting investment products in the country.

Retail FX

XTB revenues hits zł1.45 billion in 2022, Q4 earnings disappoint

Poland-based Forex and CFDs broker, XTB has reported its final results for Q4 of 2022 and the full fiscal year ending on December 31, 2022, showing one of its most successful corporate years.

Executive Moves

Lirunex Limited recruits Waleed Salah as head of MENA sales

Maldives-based brokerage firm Lirunex Limited has secured the services of Waleed Salah, who joined the company in the role of its head of sales for the MENA region.

Executive Moves

Trading 212 parts ways with co-founder Borislav Nedialkov

Trading 212 has a void to fill at its FCA-regulated business in London, following the departure of two key players, Raj Somal and Borislav Nedialkov.

Digital Assets

Binance acquires troubled crypto exchange GOPAX

Binance, the world’s largest digital asset trading platform, has reportedly acquired a majority stake in the troubled South Korea-based cryptocurrency exchange GOPAX.

Digital Assets

Kraken exits Middle East, closes UAE office

Digital currency exchange Kraken will close down its operations in Abu Dhabi, UAE and lay off the majority of its team focused on the Middle East and North Africa.

Industry News

CFTC comments on ION Cleared Derivatives issues after Russian-linked hack

“The ongoing issue is impacting some clearing members’ ability to provide the CFTC with timely and accurate data. As this incident unfolded, it became clear that the submission of data that is required by registrants will be delayed until the trading issues are resolved.”

Industry News

FCA took down 14 times more misleading ads in 2022 thanks to technology

The FCA has made significant improvements to the digital tools it uses to find problem firms and misleading adverts. These improvements have enabled it to work through a much larger number of cases compared with 2021.

Executive Moves

HKEX appoints ex-Goldman Sachs Matthew Cheong to lead platform’s focus on derivatives

“He has worked for a number of the world’s leading investment banks and his experience will be invaluable to HKEX as we continue to enhance our derivatives product offerings and build on our innovative and robust platform business, connecting capital with opportunities.”

<