Honor Levy
Honor previously worked as a solicitor in the Enforcement Division of the Financial Conduct Authority (FCA). Whilst at the FCA, she also worked as an investigator in many regulatory investigations, specialising in investigating breaches of the FCA’s rules and regulations by retail firms and their directors. Prior to joining the FCA, Honor was an associate in the General Commercial Litigation department at SJ Berwin LLP, handling a wide range of litigation cases, including representing financial institutions and directors who were subject to regulatory investigations and enforcement actions.
5 Contributions by Honor Levy
PRACTICE NOTES
FOS compulsory jurisdiction in the UK: scope, territorial reach and activities (payment services, e‑money, CBTL, claims management, credit reference agencies, finance platforms), with key transitional provisions and case law
The compulsory jurisdiction of the Financial Ombudsman Service (FOS)
Set out in Chapter 2 of the FCA’s Dispute Resolution: Complaints Sourcebook (DISP), and made under section 226 of the Financial Services and Markets Act 2000 (FSMA 2000), the compulsory jurisdiction of the Financial Ombudsman Service (FOS) requires that complaint about an act or omission by a person (the respondent) in carrying on an activity to which compulsory jurisdiction applies is considered under the FOS scheme, provided certain criteria are satisfied and the complaint meets those conditions. The conditions are that the following apply:
the complainant is eligible and wishes the complaint to be considered under the FOS scheme
the respondent was an authorised person at the time of the relevant act or omission, and
the relevant act or omission occurred when compulsory jurisdiction rules were in force for the activity concerned
The compulsory jurisdiction rules are those made by the FCA (in DISP 2) for the purposes of FSMA 2000, s 226, which specify the activities to which compulsory jurisdiction applies in relation to the activity in question. Prior to the FSMA 2000 (Transitional Provisions) (Ombudsman Scheme and Complaints Scheme) Order 2001, SI 2001/2326 (the Ombudsman Transitional Order)...
Financial Services
PRACTICE NOTES
FSCS compensation (UK): deposits, investments and insurance—calculation, limits, time limits, temporary high balances, postponement, and rejection/withdrawal of offers
The Financial Services Compensation Scheme (FSCS) operates distinct regimes for deposit claims, non‑deposit claims, and insurance policyholder protection. The Prudential Regulation Authority (PRA) sets the rules that apply to claims relating to deposits and the provision of insurance, whereas the Financial Conduct Authority (FCA) is responsible for all other forms of FSCS‑covered financial activity. The relevant rules are located in the Compensation (COMP) sourcebook within the FCA Handbook, and in the Depositor Protection and Policyholder Protection parts of the PRA Rulebook. From 3 July 2015, both (a) Chapters 9 to 12 of COMP and (b) specified chapters of the PRA Rulebook have addressed the practical aspects involved in calculating and paying compensation, once the qualifying conditions have been satisfied and the FSCS has decided that compensation is payable. There are limits on the amount of compensation that can be paid, which depend on the category of claim and are set out below, and there are also time limits within which the FSCS must make payment in full...
Financial Services
PRACTICE NOTES
FSCS compensation: qualifying conditions and eligibility for deposits, investments and insurance; protected claims and 'in default' tests under FCA COMP and PRA rules (UK)
This Practice Note outlines the conditions that must be met for a person to receive compensation from the Financial Services Compensation Scheme (FSCS). It summarises rules on:
who can seek compensation
from whom compensation may be claimed
the losses or liabilities that can be compensated
There are separate regimes within the FSCS for deposit claims, non-deposit claims, and insurance policyholder protection. The Prudential Regulation Authority (PRA) sets the rules for deposits and insurance, while the Financial Conduct Authority (FCA) is responsible for other FSCS-covered activities. The relevant provisions appear in the COMP sourcebook of the FCA Handbook and in the Depositor Protection and Policyholder Protection parts of the PRA Rulebook.
Compensation paid to eligible claimants
Claims under COMP
For claims falling within the FCA’s scope, the FSCS may pay compensation to an eligible claimant (subject to COMP 11 (Payment of compensation)) where the FSCS is satisfied that:
an eligible claimant has submitted an application for compensation (see COMP 3.2.1AR, which indicates that the FSCS may treat persons who are or may be
...
Financial Services
PRACTICE NOTES
FSCS funding and levy regime in the UK: FCA/PRA rules, class caps, retail pool, DGS/policyholder protection, exemptions, reporting and payment
The Financial Services Compensation Scheme (FSCS) derives its fundraising powers from Chapter 6 of the FEES sourcebook within the Financial Conduct Authority (FCA) Handbook, alongside designated chapters of the Prudential Regulation Authority (PRA) Depositor Protection and Policyholder Protection rules. This Practice Note offers a synopsis of the principal provisions.
Application and scope
Sections 213 and 224 of the Financial Services and Markets Act 2000 (FSMA 2000) confer on the regulators (that is, the FCA and the PRA) the ability to set rules permitting the FSCS to charge levies to authorised persons to cover its costs. Those rules appear in FEES 6 of the FCA Handbook, and in Depositor Protection 33 and Policyholder Protection 21 of the PRA Rulebook.
This delineates that the PRA is the competent authority for rulemaking on claims relating to deposits and insurance, while the FCA oversees all other categories of financial activity falling within the FSCS’s remit. In March 2013, the Financial Services Authority (FSA) — the FCA’s predecessor — issued policy statement PS13/04 on the FSCS Funding Model Review, introducing an FSA/FCA retail pool (see below)...
Financial Services
PRACTICE NOTES
FSCS UK: automatic assignment/subrogation of claims, claimant reassignment rights, eligible deposits, and compensation calculation under the Depositor Protection rules
When a compensation claim is lodged with the Financial Services Compensation Scheme (FSCS), the FSCS does not need the claimant’s permission to take an assignment of their rights while pursuing redress on their behalf. The FSCS may—and, for a deposit protection claim, must—make any compensation offer conditional upon the claimant assigning their rights to the FSCS. The FSCS can also be automatically subrogated to the claimant’s rights.
The rationale for requiring an assignment is twofold:
it stops a claimant from pursuing the same claim against another party, avoiding any betterment; and
it allows the FSCS to maximise its recoveries.
The FSCS pursues claims through insolvency practitioners, such as liquidators or administrators, where there is a realistic prospect of creditor dividends.
When taking any assignment, the FSCS must tell the claimant that, if it chooses not to proceed with a claim, the claimant may make a written request for the claim to be reassigned to them. Where such a request is made, the FSCS must honour it...
Financial Services
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