Welcome to our weekly round-up for UK financial services regulation. Paul Staples summarises the key announcements and developments. Be sure to subscribe to receive our updates in your inbox every week.

This week, conduct and culture take centre stage as the Financial Conduct Authority (FCA) looks to roll out rules for non-financial misconduct more widely across the industry. There’s little question that serious misconduct in the workpace is a regulatory concern and it's frequently seen to be the root cause of underlying failings. This drive for common standards across banks and non-banks sends a clear signal to all regulated firms. 

Next up, there’s helpful clarity from the FCA around the longer term timeline for the Advice Guidance Boundary Review, following the recent consultation on targeted support. 

And elsewhere, there’s data aplenty, with the latest updates across complaints and market cleanliness, as well as a recent consultation looking at the functioning of UK markets for bonds and derivatives. 

Tackling non-financial misconduct 

The FCA is consulting on changes to its rules around non-financial misconduct (NFM). Rules are already in place for banks to safeguard against misconduct, such as bullying, harassment, and violence. Now, the regulator is seeking to apply these rules more broadly across financial services, to drive consistency and empower firms to take robust action against serious misconduct. 

Under the changes, cases of serious misconduct will be required to be shared through regulatory references, to ensure individuals can't avoid consequences by moving between firms. Draft guidance has been published which covers how firms should assess whether an individual is fit and proper to work in financial services.  

However, the regulator is keen to stress that incidents of NFM aren't just the responsibility of the individuals involved. Failure by firms to challenge behaviour such as bullying or harassment often reflects a culture of questionable decision making and risk management. Through the new guidance, the FCA hopes to support firms that want to do the right thing and challenge behaviour appropriately.   
Feedback is being sought on whether additional guidance is needed within the FCA Handbook, to ensure that any implementation of new rules is well-supported and practical for firms. The consultation is open for responses until 10 September 2025. 

Read more on Non-financial misconduct 

FCA research sheds light on the advice gap 

The FCA recently published its 251-page consultation paper on targeted support, outlining proposals for a new form of consumer support. Alongside this, the regulator released a suite of research that deserves equal attention. This body of work reflects the FCA’s extensive efforts to understand the persistent advice gap and the challenges consumers face when navigating financial decisions. 
 
Firms can access this research through the FCA’s website. It offers valuable data for those looking to support consumers currently underserved by traditional advice models. The findings explore the obstacles individuals encounter when investing or planning for their financial futures, and highlight where firms might step in to offer meaningful support. 
 
The various research papers examine consumer communications and understanding, consumer behaviours, identifies gaps in investment engagement, and considers where people turn for financial information. It introduces the concept of a ‘knowledge gap’—a key factor in consumer hesitation—and provides a foundation for firms aiming to design more accessible, targeted services. 

Read more on bridging the advice gap through targeted support

Read more on the Advice Guidance Boundary Review from FCA

Financial complaints – latest data 

The Financial Ombudsman Service (FOS) recently published its annual report for 2024/25. The report reveals a significant rise in complaints, reaching 305,726 new cases. This is the highest in six years and a 54% increase from the previous year.  

The most complained about product was hire purchase (motor), with 76,160 complaints (an almost fourfold rise from 21,441 in 2023/24), followed by credit cards with 60,364 complaints, up from 24,402. Complaints about current accounts, primarily related to fraud and scams, totalled 36,221. The overall uphold rate across all products was 34%.  

Professional representatives brought around half of the total complaints, a notable increase from previous years, which isn't surprising given the level of advertising around motor complaints, in particular.  
The FOS aims to use this data to encourage fairness and confidence in financial services, helping to prevent future complaints. 

Market cleanliness statistics update 

The FCA has just released its latest figures on market cleanliness, offering a snapshot of how well UK equity markets are holding up against potential insider trading. 

This year’s market cleanliness (MC) statistic stands at 37.8%, a noticeable rise compared to the five-year average of 32%. It's worth noting that this increase is partly explained by a revised methodology introduced in late 2024, which makes direct comparisons with previous years tricky. 

Alongside the MC figure, the FCA continues to monitor other indicators. The abnormal trading volume (ATV) measure held steady at 5.6%, while the potentially anomalous trading ratio (PATR) nudged up to 4.1% from 3.3% last year. These metrics help flag unusual trading patterns ahead of price-sensitive announcements—though they aren't definitive proof of wrongdoing. 

The FCA is also working on new ways to measure market integrity, reinforcing its commitment to fair and transparent markets. 

For those in financial services, these insights are a timely reminder of the importance of vigilance and robust compliance practices. 

Read more on the market cleanliness statistics 2024/25

FCA consults on SI regime changes 

The FCA has released a consultation paper proposing significant changes to the systematic internaliser (SI) regime for bonds and derivatives. This is a follow up to the wholesale market’s review. Key proposals include: 


Greater flexibility: the FCA suggests removing the prohibition on SI firms from operating an organised trading facility 
Matched principal trading: the prohibition on matched principal trading by multilateral trading facility (MTF) operators is proposed to be lifted, potentially reducing operational costs and complexity 
Reference price waiver: Changes to reference price waiver rules are proposed, allowing trading venues to source prices from a broader set of venues, enhancing market resilience and competition 


The FCA is seeking feedback on these proposals by 10 September 2025. Responses can be submitted via email to cp25-20@fca.org.uk.  


Read more on CP25/20: The SI regime for bonds and derivatives including Discussion Paper on equity markets 


Read more on CP25/20: Consultation Paper on the SI regime for bonds and derivatives