FCA updates on 'polluter pays' and redress guidance

Measures aim to protect consumers and ensure firms meet regulatory obligations

Sahar Nazir
clock • 2 min read

The Financial Conduct Authority (FCA) yesterday (14 January) published updated guidance for firms on managing redress liabilities and tackling "polluter behaviour" to protect consumers, maintain trust in the financial system, and ensure firms meet regulatory obligations.

Under Principle 4 (Financial Prudence), firms are expected to maintain adequate financial resources to meet redress liabilities. This principle extends to firms subject to prudential standards, reinforcing that financial health must align with regulatory requirements. Polluter behaviour – actions by firms leaving behind unresolved liabilities – has caused consumer harm and strained the financial services market, according to the watchdog. In cases where firms genuinely cannot meet liabilities, they are urged to provide evidence-backed reasons for their actions and decisions. The FCA s...

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