The FCA's strategy puts financial crime enforcement first

Interventions and enforcement take a back seat for most of the FCA's 2025-30 strategy.

Or do they?

The need for speed

Yes, the FCA reiterates its aim for a more streamlined portfolio of enforcement cases.

But it still wants "the same number of outcomes". Just "delivered faster". It wants to ensure that those who break the rules are "swiftly held accountable".

And it wants to use "new approaches" (curious to know more about these) to better handle supervisors' significant caseload, "so we can act faster and more assertively where harm is greatest".

To me, this doesn't look like a de-risked interventions and enforcement environment at all.  Instead, it looks like a more volatile one.  One where firms must stay nimble to respond effectively to potential regulatory escalation.  One where firms will prepare for the directions of travel FCA supervisors and investigators might take by expanding and front-loading their own internal fact-finding and remedial work.

Good cop, bad cop

And there's one area where the FCA is, if anything, more strident in its enforcement messaging.

Financial crime.  Specifically, firms using authorisation as a "cover for crime". Fair enough.

But it goes on, taking on a good cop / bad cop vibe.  The FCA sees regulated firms as a vital line of defence against the criminal misuse of financial services.  It wants to "work with those firms who we know want to play their part in tackling crime", and encourages innovation and tech here. But it also wants to continue to "act against those through which criminal cash finds its way into our system".

The interventions and enforcement risks here can be significant. When the FCA sees potential AML controls shortcomings in a firm, one of its favoured responses is to impose a requirement restricting or preventing new business.  Which can be significantly more costly than a fine.

To de-risk here, what's a firm to do?  Some suggestions:

• Keep your AML and financial crime controls functions adequately resourced, of course.  And regularly review your policies, procedures and risk assessments.
• Project proactivity.  Take opportunities to show your supervisors you're quickly remediating AML issues.  And consider engaging with industry-wide innovation initiatives on AML and financial crime controls.  Information sharing will be key, whilst respecting data protection - enabled by tech.  Will we finally see industry-wide multiparty computation initiatives gather steam?
• Prioritise potentially illicit funds flows with the greatest volume (these may more quickly invite FCA intervention).  Yes, high-value transactions; but also keep honing your automated capability to detect smaller-value transaction groups suggestive of layering.  And attend to all potential money laundering channels: for example, money laundering through the markets (MLTM) is receiving increasing attention.