FCA abandoning its plans to publicly criticize is a positive development
The Financial Conduct Authority (FCA) has abandoned its initial proposal to implement broad "name and shame" rules for firms under investigation, following widespread criticism. Instead, as of 2025, the FCA’s current policy limits public naming to exceptional circumstances only.
The new policy, detailed in the FCA’s revised Enforcement Guide, outlines three specific scenarios where public announcements may be made. These include naming individuals or firms specifically in investigations related to unauthorized business or criminal offences when publicity can protect consumers or support the investigation. The FCA may also confirm involvement reactively if the investigation is already publicly known from other sources, such as press reports or voluntary firm disclosures. Lastly, anonymized announcements for educational or deterrence purposes may be made, sending market-wide compliance messages without naming the subjects.
This approach seeks to balance transparency and regulatory objectives with fairness and the risk of unwarranted reputational harm to firms. The FCA explicitly rejected the earlier “public interest” test that would have allowed more frequent naming of firms under investigation, after industry pushback and legislative criticism emphasizing the commercial damage such disclosures could cause.
A report by the House of Lords Financial Services Regulation Committee in February 2025, titled "Naming and Shaming: How Not to Regulate", criticized the FCA’s proposals. The report highlighted concerns about the potential for reputational damage and the lack of clarity in the proposed "public interest" test.
The new policy is a significant improvement on the initial proposals, as it allows for a FCA announcement to confirm the nature of an investigation as far as it has already been made public. The FCA’s willingness to listen to criticism and amend its original proposals is commendable.
Firms operating in multiple jurisdictions need to consider the potential impact of FCA announcements on notifications to regulators in other jurisdictions. Anonymized announcements could be useful tools for firms to understand the FCA’s focus and encourage compliance.
Public disclosures by investigation subjects, such as those in audited accounts, need to be carefully drafted to avoid misinterpretation by the FCA. Firms should monitor the FCA’s announcements going forward to gain valuable insights into the regulator’s mindset. The FCA has significant discretion regarding the content of anonymized announcements.
The link to the report by the House of Lords Financial Services Regulation Committee is: https://publications.parliament.uk/pa/ld5901/ldselect/ldfsrc/76/76.pdf
The FCA’s new policy provides for three additions to the circumstances in which investigations will be announced: suspected unauthorized financial services or a suspected offence relating to unregulated activity, public disclosure by the subject, an affiliated company, regulatory body, government, or public body, and anonymized announcements for educational purposes. The changes will only apply to investigations launched on or after 3 June.
Under the original proposals, the investigation subject would have received no more than one business day's notice of an announcement, and the FCA would have published updates periodically, including on closure. The proof of the new policy’s effectiveness will be in its implementation, and the FCA needs to ensure that negative feedback and concerns expressed about the original proposals are addressed in future announcements.
[1] House of Lords Financial Services Regulation Committee (2025). Naming and Shaming: How Not to Regulate. Retrieved from https://publications.parliament.uk/pa/ld5901/ldselect/ldfsrc/76/76.pdf [2] Financial Conduct Authority (2024). FCA Consultation Paper No. 24/25: Naming and Shaming. Retrieved from https://www.fca.org.uk/publications/consultation/cp24-25 [3] Financial Conduct Authority (2024). Speech by Nikhil Rathi, Chief Executive, at the Association of British Insurers. Retrieved from https://www.fca.org.uk/news/speeches/speech-nikhil-rathi-chief-executive-association-british-insurers [4] HM Treasury (2024). Response to the FCA’s Consultation Paper No. 24/25: Naming and Shaming. Retrieved from https://www.gov.uk/government/publications/hm-treasury-response-to-the-fca-s-consultation-paper-no-24-25-naming-and-shaming [5] TheCityUK (2024). TheCityUK Response to the FCA’s Consultation Paper No. 24/25: Naming and Shaming. Retrieved from https://www.thecityuk.com/media/1129/thecityuk-response-to-the-fcas-consultation-paper-no-24-25-naming-and-shaming.pdf
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