FCA Proposes New Consumer Duty – TCF With Bigger Teeth?

Summary

On 14 May 2021, the FCA published Consultation Paper CP21/13 outlining much-anticipated proposals relating to the standards expected of regulated firms to ensure the protection of retail consumers. The Consultation Paper follows a recently published speech given by Charles Randell, Chair of the FCA and PSR, in which Mr. Randell outlined changes required to transform regulation and reshape the FCA to better protect consumers. Indeed change in this area has been on the cards for quite some time. In January 2020, fellow BCLP partner Nathan Willmott predicted in our Emerging Themes in Financial Regulation 2020 publication that the FCA would bolster the Principle 6 duty to treat customers fairly and add a new Principle and high level obligations requiring firms to adopt fair pricing practices. Although these proposals were delayed by the COVID-19 pandemic, which the FCA recognise in their Consultation Paper, it would appear that plans are now coming to fruition.