On 15 September 2021, the FCA published its strategy for consumer investments together with a feedback statement following its earlier call for input on consumer investments. The purpose of the strategy is to give consumers the confidence to invest, supported by a high quality, affordable advice market, which should lead to fewer people being scammed or persuaded to invest in products too risky for their needs.
To achieve this the FCA is setting out a package of measures that include:
- Implementing the consumer duty.
- Strengthening the financial promotions regime in 3 areas – the classification of high-risk investments, further segmenting the high-risk market and strengthening the requirements on firms when they approve financial promotions.
- Launching a new £11m investment harm campaign, to help consumers make better-informed investment decisions and to reduce the number of people investing in inappropriate high-risk investments.
- Detecting and challenging firms who take on Appointed Representatives and wider reforms to the Appointed Representatives regime.
- Exploring regulatory changes to enable firms to provide more sales and support services to mass market consumers investing in straightforward products like stocks and shares ISA wrappers.
The FCA has also published a consumer investments data review which covered the period from 1 April 2020 to 31 March 2021 and shows the regulator’s work to tackle harm which included:
- Stopping 48 new firms from entering the market where the FCA identified potential for consumer harm (representing 1 in 5 applications).
- Opening over 1,700 supervisory cases involving scams or higher risk investments.
- Publishing over 1,300 consumer alerts about unauthorised firms and individuals.
