Your guide to this week in regulation

This week, the Financial Conduct Authority (FCA) sharpens its focus on consumer harm, while regulators continue in their pursuit to support growth and innovation including targeted attention towards specific sectors.

We lead with the FCA-led taskforce, working jointly with the Advertising Standards Authority (ASA), Solicitors Regulation Authority (SRA) and Information Commissioner's Office (ICO), continuing its crackdown on misleading car finance claims adverts and poor practice by claims management companies (CMCs).

Elsewhere, Anthropic joins the FCA's Supercharged Sandbox to support those firms testing AI use cases. And the Prudential Regulation Authority (PRA) consults on updated guidance for friendly society transfers to support the mutual sector's competitiveness.

We also cover a recent Bank of England speech setting out how the core functions of money underpin the full range of its policy work.

We conclude this week as the FCA demonstrates the effective reach of its investigative and enforcement powers.

Taskforce steps up car finance ad crackdown

The FCA-led taskforce continues to act on misleading advertisements for motor finance claims. During June 2026, 170 adverts were removed or amended, taking the total to 1,200 since January 2024. Common problems include adverts disguised as impartial social media recommendations, misuse of the FCA's redress scheme to suggest official backing, and unclear information about free claim routes.

Two firms agreed voluntary requirements to change their marketing, bringing the total to 12 over the past year, and the FCA issued eight alerts against unauthorised firms. Alongside the FCA, the ASA, SRA and ICO are investigating wider poor practice by CMCs and law firms, including exaggerated compensation claims and unclear fees.

Firms in this space should review their marketing and referral arrangements against Consumer Duty expectations and financial promotion rules.

Read more on the joint taskforce against misleading car finance claims adverts

Anthropic joins FCA's AI sandbox

Anthropic will support the second cohort of firms in the FCA's Supercharged Sandbox, a controlled environment for testing advanced AI. Anthropic will give participants access to Claude, including Claude Code and Claude Cowork, to help speed up development work.

Twenty-one firms will explore use cases such as safer agent-led payments, stronger fraud detection, wider access to financial services for vulnerable and underserved consumers, and streamlined compliance. Applications rose by 51% compared with the first cohort, reflecting strong demand for the programme.

The FCA has also launched the Agentic Academy, a 10-week AI programme delivered with the Centre for Finance, Technology and Entrepreneurship. The sandbox builds on existing support from NayaOne and NVIDIA, and forms part of the FCA's wider commitment to support growth while relying on existing regulatory frameworks rather than new AI-specific rules.

Read more on Anthropic's support for the Supercharged Sandbox

PRA consults on friendly society transfers

The PRA is consulting on updated guidance for how friendly societies and other mutuals carry out Part VIII transfers and amalgamations. The changes update statement of policy 3/15 and follow the PRA's commitment in the PRA/FCA Mutuals Landscape Report to support the sector's growth and ability to compete.

The proposals are intended to:

• set out the sequence firms typically follow when undertaking a transfer;
• give greater transparency on when the PRA may waive a member vote or require an independent actuary's report; and
• clarify the scope of the process for firms that are, and are not, friendly societies.

The consultation closes on 22 October 2026. Subject to responses, the changes would take effect once the final policy statement is published.

Read more on the PRA's consultation on friendly society amalgamations and transfers

Framing policy through money's role

In a speech at OMFIF, Nathanaël Benjamin, the Bank of England's executive director for financial stability strategy and risk, set out a single framework for central bank policy built on the three core functions of money: a store of value, a unit of account and a medium of exchange.

Benjamin set out how these functions are intertwined, and that Bank’s activities exist to protect them, whether by building resilience against shocks, removing frictions that block growth, or supporting responsible innovation that strengthens how money works. He described the Bank's task simply as ensuring trust in money.

The approach draws on insights gathered through the Bank's regional network of agents, including direct conversations with citizens and businesses. It offers a useful lens for firms trying to understand how individual items of Bank and PRA policy connect to a single underlying purpose.

Read more on the speech, "It's all about the role of money"

Latest developments in FCA fraud investigation

The FCA has recently announced certain arrests in connection with its investigation into fraud and money laundering. The operation was carried out jointly with the police's Eastern Region Special Operations Unit and the South East Regional Organised Crime Unit.

This action reflects the FCA's continued focus on tackling fraud and money laundering through joint operations with law enforcement

Read more on the arrests and searches made as part of the investigation