FCA clarifies approach to compromises for regulated firms

Focuses on three types of compromise

Ayesha Venkataraman
clock • 2 min read

The Financial Conduct Authority (FCA) has issued its final guidance on its general approach to compromises for regulated firms to ensure alignment with the regulator’s statutory objectives to protect consumers and the integrity of markets.

In its finalised guidance, published on 5 July, the FCA highlighted that it was seeing an increase in the number of regulated firms proposing compromises to deal with significant liabilities to consumers, in particular redress liabilities. In a bid to reduce the number of proposed compromises that it considers to be inappropriate, the regulator set out what information it needs from regulated firms as well as its approach to compromises. It defined compromises as arrangements between a firm and its creditors and/or shareholders that can be used to reorganise a company or group structu...

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