MyComplianceOffice Blog

Failing to adequately manage Material Non-Public Information (MNPI) remains a high-risk area for compliance, as evidenced by recent actions in the United States, the United Kingdom and across the globe for issues including insufficient insider trading compliance policies, market abuse and failure to effectively manage insider information.

It's been about six months since the Consumer Duty came into force, setting higher and clearer standards for consumer protection across the financial services industry.

How are firms doing with their implementations and delivery of the good customer outcomes that the FCA expects as the duty comes into force? The agency recently published guidance on lessons learned, including good practices and areas for improvement.

The European Market Abuse Regulations (MAR) have been in effect since July of 2016. Recent priorities published by regulators in the UK and across Europe demonstrate that MAR is hardly old news, remaining a consistent priority since its inception. And regulatory enforcement shows that even six years in, firms are still struggling to stay compliant with MAR regulations and the flow of material nonpublic information (MNPI) across their organizations.

On 11 January 2023, the Financial Conduct Authority (FCA) published a "Dear CEO" letter to wholesale broker firms, highlighting key risks and drivers along with their supervisory focus for the next two years. The letter places particular emphasis on the Senior Managers and Certification Regime (SMCR), market abuse, personal account dealing-and the need for firms to have robust systems and controls in place to effectively manage and evidence these risks. 

With the end-February 2023 deadline for next steps looming, time is of the essence for senior executives and board members to review the current state of compliance in these areas and develop an action plan to fill in the gaps. 

The Financial Conduct Authority (FCA) regulates over 58,000 financial services firms and financial markets in the UK. To do this effectively, the authority needs timely and accurate data from firms to identify malpractice and take appropriate action.

This is why the FCA’s reporting requirements exist—to ensure it has the information it needs to perform its role. It’s also why the FCA levies tough penalties on firms that fail to meet their reporting obligations.