The FCA has been probing into financial entities in the United Kingdom have increased for the first time since 2015; this is because of an increase on the two emerging financial crimes of white-collar and money laundering illegal activity.
The FCA Plans on Taking Control
The most recent information and reports define that regulators have requested a skilled persons’ reports from fifty one financial experts, in the 2018-19 financial year. This is a sixteen percent increase since that of last year. These reports are most requested by legal firms or accountancy companies, however this time it comes from the FCA. The UK financial watchdog has some concerns over elements in business.
According to the reports, more commonly known as Section 166, they “serve as an initial exploratory step and as such are typically kept confidential but can be used by the regulators to launch full enforcement investigations.”
There is currently business enterprise that is under investigation, which has to provide payment for the probe. The cost would approximate to one-hundred thousand GBP; this is regardless of the probe finding any fraudulent activity.
The peak of the reports reached 140 in 2010-11, but the current total reports have been alarmingly high.
Forecasts on the Total Reports
According to the accountancy company of Binder Dijker Otte, which is more commonly known as BDO, has analyzed the latest data and predictions that there will be more probes in the next year.
“Regulators have been increasingly using these reviews to crack down on companies where there is a higher risk of money laundering activities,” stated Fiona Raistrick, a partner at BDO. “Online trading firms have come under particular pressure from regulators in this area. The FCA has urged them to tighten transaction monitoring to help reduce their exposure to potential money laundering and fraud.”
There have been headlines and breaking news in the financial industry because of the skilled persons’ reports, leading to the exposure of the gross misconduct at the Royal Bank of Scotland’s restricting division GRG.
In earlier December, the FCA, the PRA, and the Bank of England have released a shared summary of policy on new regulations to empower the resilience of operations in the financial services industry. The regulators called upon banks and payment companies to apply “impact tolerances” for essential financial services, due to various information technology deficiencies in the past year. This led to an array of financial entities to review their conditions and the structure of the institution.