The UK’s financial watchdog the Financial Conduct Authority (FCA) has said it will be cracking down on bad firms and tackling “an epidemic” of online scams.
“To act decisively – and to be clear about what we’re doing, why we’re doing it and where the limitations lie..”
Rathi said that he FCA will be spending £120m ($165m) over three years to improve its data strategy to tackle fraud better. He also announced an £11m digital marketing campaign targeted at younger consumers buying cryptocurrencies.
“Modernising our systems – including becoming one of the first regulators in the world to move to the cloud – will give us the platform to succeed. Not only enabling us to scale our operations but to share intelligence more easily within the FCA and with our partners across responsibilities and jurisdictions,” he said.
The government has faced calls to force companies to stop investment fraud facilitated through online advertising as part of its Online Safety bill. But it has rejected the idea, saying there would be a consultation on online advertising regulation later in the year.
The FCA’s focus on protecting vulnerable consumers could mean wealthy investors will find it harder to get compensation. There will be a review of compensation criteria used by the Financial Services Compensation Scheme, Rathi said.
The FCA, along with the Bank of England, is exploring opening an office in the northern English city of Leeds with at least 100 staff based there at the end of 2022, and doubling headcount to over 200 in its Edinburgh office, Rathi said.
The FCA has been criticised for its handling of London Capital & Finance, the investment fund whose collapse is forcing the government to use taxpayer money to compensate thousands of investors.