FCA transparency drive delivers first Enforcement Watch publication

During discussions around the FCA’s 2024 attempt to secure greater powers to name firms under investigation – which concluded with a retreat in early 2025 - many across the industry argued that publication of an ‘Enforcement Watch’ document summarising key trends in FCA enforcement would be a better  - more proportionate – means of educating the market about areas of concern.

The FCA has now published its inaugural Enforcement Watch newsletter. This follows the FCA’s successful defeat of the first challenge to a decision to name a firm under its updated publicity policy. The two combined give a flavour of the FCA’s approach to transparency moving forward, together with a deeper insight into the FCA’s current docket of investigation work.

This is significant, because the FCA’s enforcement function has undergone a substantial transformation since the arrival of Therese Chambers and Steve Smart in 2023. Case numbers are down, and any new investigations are closely aligned to the FCA’s strategic priorities. Fewer published outcomes make it more difficult to understand what is happening behind the scenes. Enforcement Watch provides much of this detail.

Revised approach to publicity

The newsletter opens with a reminder of the FCA’s updated publicity policy before turning to statistics. Between 3 June and 31 December 2025, the FCA opened 23 enforcement investigations. Of these:

• it confirmed the opening of three investigations following announcements by the firms concerned (all of which were listed issuers);

• it confirmed two investigations into insurers in the home and travel insurance market without disclosing their identity;

• it chose not to name two unauthorised firms under investigation for ‘operational reasons’ (which is interesting, given that harm caused by unauthorised firms was cited as a key driver for seeking greater publicity powers);

• it named one firm under investigation where its ‘exceptional circumstances’ test was satisfied (see here).

Six investigations involved individuals, where the threshold for public announcement is considerably higher. For the remaining investigations into authorised firms, the FCA did not consider that the ‘exceptional circumstances’ test was satisfied, but has confirmed it is keeping the position under review. Given that the test for announcing an investigation requires circumstances to be ‘exceptional', we would not expect a substantial number of these investigations to become public prior to reaching a settled outcome.

Case priorities

The newsletter highlights the following areas of current enforcement focus:

The road to enforcement

The FCA reminds firms that those who choose to ‘do the right thing' by putting things right promptly may avoid a full enforcement investigation. It also suggests that the following factors are likely to prompt the use of enforcement tools:

• Repeated failures to be open with the FCA;

• Deliberately misleading the FCA, consumers or the markets; and

• Causing significant harm to consumers through fraud, disruption to services and misappropriation of assets.

This approach aligns with the FCA’s stated objective of targeting its enforcement activity at firms and individuals that pose the greatest risk of harm.

International cooperation

The newsletter concludes by highlighting the FCA’s membership of IOSCO and the role of global partnerships in enabling the FCA to gain access to information from other jurisdictions to support its investigations. Both mutual legal assistance channels and the ability to apply for overseas production orders under the Crime (Overseas Production Orders) Act are cited as key tools. These are particularly important in tackling fraud and online scams, where perpetrators are often based outside of the UK. The 2025 international crackdown on illegal finfluencers is cited as an example of the type of work the FCA intends to continue into 2026.

Next steps for firms

As noted at the outset, Enforcement Watch fills some important gaps in terms of the visibility of ongoing FCA enforcement work and areas of focus. There are notable disclosures, including six Consumer Duty investigations, to which firms should pay close attention when planning their governance and compliance priorities for the year ahead.

We are currently considering what this tells us about the future shape of FCA enforcement - and how firms can stay ahead - in our annual Trends conversations with clients. Contact us if you would like to meet with the Linklaters team to hear more.