2024 was the first full year of the Consumer Duty era. The year was marked by an intriguing mix of political and legal developments with unusually significant impact on the typical plethora of regulatory issues. These dynamics brought both opportunities and challenges for the UK retail investment sector.
The second half of the year was shaped by significant political shifts under the new Labour government and its 'growth' agenda, which aimed to position the City as a global leader. The Advice Guidance Boundary Review and Redress Framework Review have the potential to be transformational for UK wealth management. At the same time, the Courts are back, bringing 'more law' but (unfortunately) less legal certainty. The Court of Appeal's motor finance commission decision may not apply directly to investment firms but it has worrying implications across consumer financial services. The FCA continues its relentless focus on wealth managers, across advisory, execution only and discretionary service lines, as if trying to stay ahead of it all, while seeking approval from Treasury. The interplay between these forces has created an uncertain and evolving landscape for wealth management.
Key topics covered in the review
Our report explores the most pressing developments and challenges from the past year, including:
- Pensions Focus: A deep dive into the evolving personal pensions landscape
- Regulatory Reform: Updates on the FCA and FOS, the ongoing advice services review, prudential regulation, complaints handling and the redress framework review, and the impacts on M&A in our sector
- Supervision, not Enforcement: The FCA's move towards data-driven supervisory intervention instead of traditional Enforcement
- Legal Challenges: High-profile court cases, including the Court of Appeal's rulings on motor finance commissions and the FCA's redress powers
We also address broader themes, such as the tension between consumer protection and market liberalisation, the increasing scrutiny of PE-backed consolidator structures, and the FCA's efforts to modernise its approach to risk tolerance.
Our expertise
As always, our team has been at the forefront, advising clients on these critical issues and helping them navigate a complex and dynamic regulatory environment. From the formation of the Platforms Association, to ongoing support with Consumer Duty implementation and responding to the FCA's various reviews and supervisory interventions, we remain committed to assisting our clients with their regulatory and compliance needs.
We invite you to explore the full review for in-depth analysis and insights into the trends shaping wealth management. If you’d like to discuss any of the topics in more detail, please don’t hesitate to get in touch with the authors.
