The Financial Conduct Authority (FCA) is considering a significant shift in its investigation approach, aiming to increase transparency by publicly naming companies under investigation.
In a consultation paper, the FCA proposes a move toward a more open stance, disclosing the names of investigated firms to enhance public confidence, strengthen deterrence, and encourage whistleblowers.
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This represents a departure from the current practice of rarely disclosing ongoing probes. The regulator aims to clarify the types of serious failings that can trigger investigations, fostering quicker behavioural changes by the firms themselves. The move aligns with efforts to accelerate and make enforcement actions more transparent.
The FCA acknowledges the potential impact on companies’ reputations but is consulting on the benefits of enhanced accountability and public confidence.
Critics express concerns about the reputational damage inflicted before any wrongdoing is proven. The proposal is part of broader efforts by the FCA’s enforcement heads, Therese Chambers and Steve Smart, to bolster enforcement actions following a notable decline in fines issued last year.
The consultation period for the proposed changes is open until April 16.
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