FCA faces an uphill struggle to combat the growing problem of unauthorised firms as around 40% of online unauthorised firms which are subjected to recent FCA warnings still have active websites, according to a study conducted by Money Marketing.
The study report suggests that hat the current practice of publishing warnings is not acting as a deterrent.
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The FCA warnings range from firms cloning genuine financial services companies to pensions-unlocking, carbon-credit trading and deposit free homes. The warnings are categorised under the "unauthorised firms and individuals to avoid" section of the FCA website and the 142 warnings published since the FCA started up in April is a huge increase on the FSA’s 10 warnings in 2012/13.
The research findings of the most recent 100 warnings finds that 74 of the firms used a company website to promote themselves online and, of this number, 31 still operate active websites.
The FCA can prosecute these offences, issue a winding-up order and can claim the proceeds back from the unauthorised firm to redistribute these to investors.
Also, the Advertising Standards Agency has the power to name and shame firms which provide misleading advertising but it has no powers to shut down websites and only limited powers to force other sanctions.
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By GlobalDataAn FCA spokesman said: "We use our criminal and civil powers to take action through the courts to stop those firms and individuals who pose the greatest harm to consumers. We take seriously all information we receive about unauthorised firms operating in the UK and targeting UK consumers."
