This week, we lead with the Financial Conduct Authority’s (FCA) latest expectations on unfair terms in consumer contracts, which show how the Consumer Duty and consumer law permeate the small print as well as the product. Next up, the FCA sets out its minimum standards for lenders that make voluntary settlement offers on motor finance complaints while the redress scheme is partly suspended, ahead of legal challenges due to be heard from 16 February 2027.
Meanwhile, the FCA consults on how a future equity consolidated tape provider should share income with the firms that supply trade data. Elsewhere, its latest findings from supervising wholesale banks are far-reaching and cover resilience, artificial intelligence, financial crime and conflicts of interest.
We conclude this week with finalised technical standards for the intragroup regime under the UK European Market Infrastructure Regulation (UK EMIR). Whilst the regime takes effect on 1 January 2027, the FCA expects firms that want new exemptions in place beforehand to notify it before 5 December 2026.
The FCA has explained how it uses the Consumer Rights Act 2015 to challenge unfair or unclear terms in consumer contracts, and weighs its rules, including the Consumer Duty, when choosing how to act. Where it raises a concern, it expects the firm to amend or delete the term, stop relying on it in existing contracts and pay redress if customers suffered harm. It can also seek an undertaking or a court injunction.
Examples include a financial adviser that tried to charge £800 for handling a complaint, a crypto firm that charged inactive customers disproportionate storage fees, a lender that improved the terms of a new credit product before launch, and a travel insurer that paid £18,000 in redress for wrongly denied claims.
The FCA expects firms to use complaints data to find unclear wording, write in plain language, make fees, cancellation rights and exclusions easy to spot, test customer understanding of main terms, and review contracts regularly. Firms can test their own terms against these expectations.
Read more on making consumer contracts fair
The FCA has set minimum expectations for lenders making voluntary full and final settlement offers on motor finance complaints while its redress scheme is partly suspended. The legal challenges are due to be heard between 16 February and 3 March 2027.
The FCA supports offers that give customers no less than the maximum redress under the scheme. Each offer letter should avoid any suggestion of FCA approval and give customers at least one month to respond.
An appendix should show the remedy and how the amount was calculated. Lenders must share the FCA factsheet with customers, and the FCA expects firms to tell them if they plan to make offers.
Read more on motor finance settlement offers
Read more on the FCA expectations for settlement offers
The FCA is consulting on how the future UK equity consolidated tape provider should share income with the firms that supply trade data (CP26/39). It also proposes stricter incident reporting for all consolidated tape providers.
Specifically, the FCA proposes that:
The FCA does not expect any one contributor to receive large sums in the short to medium term. It plans a policy statement in spring 2027.
The consultation closes on 17 December 2026. Trading venues, approved publication arrangements, systematic internalisers and current or potential tape providers can respond by that date.
Read more on CP26/39 for consolidated tape providers
The FCA has published its third set of insights from supervising wholesale banks, drawing on incidents, multi-firm reviews and internal audit findings. The paper is aimed at wholesale banks and other wholesale market participants.
On resilience, the FCA found weaknesses at individual firms in data ingestion controls, asset inventories, algorithmic trading testing and data loss prevention. It says stronger self-assessments used granular evidence, and that banks should calibrate impact tolerances to market harm and separate current capability from planned remediation. It also reminds banks that they remain responsible for communications surveillance when they use third parties. On artificial intelligence, it cites a case where human review missed inaccurate code recommendations, and data leaks from staff using unapproved tools.
Other findings cover bank funding of unregistered Annex 1 firms, securitisation due diligence, sharing client risk information within prime brokerage, and controls on erroneous quotes.
Banks that want to carry out new cryptoasset activities can apply for a variation of permission, and the FCA expects applications by 28 February 2027.
Read more on wholesale banks supervision insights
The FCA has published final binding technical standards for the UK EMIR intragroup regime (PS26/21). They sit alongside HM Treasury regulations that make the regime permanent. The new regime takes effect on 1 January 2027 and replaces the temporary intragroup exemption regime, which expires on 31 December 2026.
Intragroup margin and clearing exemptions in place before that date, including those granted under the temporary regime, continue to apply while their conditions are met. The policy statement also revokes certain questions and answers and makes further changes that reduce burdens on counterparties.
The FCA encourages counterparties that want new exemptions before 1 January 2027 to notify it before 5 December 2026, using the current process. Those intending to notify between 5 and 31 December 2026 are asked to contact the FCA as soon as possible. From 1 January 2027, all notifications go through Connect under a streamlined process. Chapter 5 of the policy statement explains the steps before and after that date.
Read more on PS26/21 for the UK EMIR intragroup regime
The partial suspension of the FCA’s redress scheme has not reduced the risk facing motor finance firms. It has extended the timeline, which will leave the outcome unresolved when the next accounts are signed and funding lines come up for renewal. We look at what this means for going concern assessments, access to funding and the actions boards should take now.
FCA updates on pure protection, vulnerability in payments, rising whistleblowing cases, AI-driven investment risks, and T+1 readiness challenges.
Cryptoassets are becoming a more common feature of customer activity, exposing firms to new financial crime risks through onboarding, source of wealth assessments, sanctions reviews and transaction monitoring. This article explores how organisations can identify those exposures, investigate crypto-related activity and assess whether existing controls remain appropriate.
