Legal News

The Financial Conduct Authority has secured approval to participate in the landmark car finance hearing expected to shape the industry’s future. However, the Supreme Court instead refused leave to the leading trade body, the Finance & Leasing Association. A ministry spokesperson said the finance ministry was likewise refused permission to intervene in the case, adding that it would still “monitor it closely” closely. The department had sought to take part in the hearing, concerned that an outcome in favour......

The UK Supreme Court, due to open the appeal on 1 April 2025, formally told both parties on 17 February 2025 that leave had been denied. It offered no detailed public explanation whatsoever at all for its decision to refuse HM Treasury’s January 2025 application to participate in appeals filed by the lenders after the Court of Appeal ruled that any sums paid to dealerships for arranging finance must be fully revealed to customers. The government voiced serious concern that the judgment could have a significant and potentially harmful effect on the market. The Treasury did not promptly respond to a further immediate public request for comment on......

The Bill’s principal aims, as signalled by its long title, are to create an independent Office of the Whistleblower ( OWB) and to safeguard both whistleblowers and the practice of whistleblowing. The OWB would be empowered to set, oversee and enforce minimum standards for managing whistleblowing matters. This would encompass establishing protocols for handling protected disclosures, providing independent disclosure and advice services, undertaking whistleblowing investigations, and directing redress for any detriment suffered by whistleblowers. Should the OWB be established, it would represent a substantial shift for organisations in how whistleblowing is addressed, notably by offering individuals the option to report concerns to an independent third-party body with investigatory powers. To understand the Bill’s impetus, how we have reached this point, the case for changing perceptions of whistleblowing, and the treatment of whistleblowers and the response to their reports, it is useful first to...

As it released its 2024 results, the British banking group disclosed that the regulator has initiated a civil enforcement investigation. The lender noted in its report that the FCA probe ‘principally relates to the historical oversight and handling of certain customers with elevated risk’. Barclays also said it has been co-operating with the investigation. This fresh money laundering probe represents the FCA’s latest move involving the lender. In November 2024, the regulator fined the bank £40m over ‘reckless’ arrangements the bank made with Qatari investors while it was raising fresh capital during the 2008 financial crisis... The regulator......

The UK Supreme Court unanimously allowed Joseph El‑ Khouri’s appeal, stopping the United States from seeking the London-based trader’s extradition to answer allegations of insider dealing. The justices reversed two lower-court decisions, finding he could not be surrendered because the core of the alleged misconduct occurred in the UK. They observed that the sole act said to have taken place in the US was paying for a middleman’s hotel room in New York, while the locations where any gains were later enjoyed were merely incidental. Delivering the ruling, Justice George Leggatt said the lower courts were wrong to hold that extradition was justified on the basis that the supposed insider dealing was “felt” on US markets. That conclusion, he explained, conflicts with the plain wording of the extradition scheme, which ties “conduct” to where the physical acts were carried out, not to where their...

Provision and motor commissions review The lender expects to recognise a provision in its 2025 half-year statement. The sum is intended to address potential operational and legal expenses, together with estimated remediation for customers who have been affected. Nevertheless, the merchant bank, which holds a main market listing on the London Stock Exchange, warned that there remains considerable uncertainty about the range of outcomes from the motor commissions appeals and the FCA's ongoing review of motor commissions, and as a result the eventual cost to the group could prove materially higher or lower......

UK Finance, in a recent paper, urged the government to scale up investment to tackle economic crime and payment fraud, matching the magnitude of the threat. It argued that technology firms should shoulder part of prevention costs through a more transparent, accountable reimbursement framework and dedicated funding. To inform ministerial choices on allocating resources to financial services for 2026–2028, ahead of the spring budget, UK Finance outlined a set of recommendations. The aim, it said, is for public funding to unlock the sector's role as an engine of growth. ' We need the social media, technology, and telecommunications sectors to do far more alongside us to safeguard the public and society from fraud', the paper stated......

El- Khouri v Government of the United States of America [2025] UKSC 3 Background This appeal stems from a request by the US to extradite El‑ Khouri, a dual British/ Lebanese citizen residing in the UK. The request essentially alleges insider dealing: that El‑ Khouri paid significant sums to an intermediary to obtain confidential inside information about proposed mergers and acquisitions involving companies quoted on US stock markets, and then traded in contracts for difference to profit from that information. The intermediary, who was likewise based outside the US, is said to have obtained the information from two analysts working in the London office of an investment bank. El‑ Khouri is alleged to have remunerated the intermediary in cash and benefits, including funding for a yacht in Greece, a chalet in France and, on two occasions, a hotel room in New York. It is further...

The executive order signed on 10 February 2025 puts a 'pause' on the federal Foreign Corrupt Practices Act ( FCPA), the signature anti-bribery law used to prosecute US and foreign companies for bribing overseas officials to win business abroad. Although this creates scope for the SFO and other cross-border white-collar bodies to fill the gap, the inclination to step in could be politically hazardous, said Dan Hudson, a partner at Seladore Legal. “ I suspect the SFO and enforcers in, for example, France and Germany might well feel they should scrutinise US-headquartered businesses, where their jurisdiction allows, if the US Department of Justice won’t take action,” Hudson noted. Yet he warned the move by Trump could be a “bear trap”, potentially putting the UK on a difficult footing with him early in his administration. “ It remains to be seen whether UK politics will come into...

UK developments LMA publishes its green loan terms The Loan Market Association ( LMA) has issued its definitive green loan terms, building on the draft provisions circulated on 7 November 2024. The terms are intended to deliver greater clarity and uniformity in the structuring and negotiation of green loans, ensuring alignment with identifiable industry benchmarks. The document can be accessed by members only via the LMA website. See: LNB News 10/01/2025 10. Source: Documents. FRC publishes review of CFD’s by AIM and large private companies The Financial Reporting Council ( FRC) has released its review of climate-related financial disclosures ( CFDs) by AIM and large private companies, following the first cycle of mandatory reporting. While companies have endeavoured to meet CFD requirements, the FRC identified variations in the quality of disclosures across the selected companies. The report showcases examples of good practice and pinpoints areas where...

In this issue UK, EU and international regulators and bodies Accountability, culture and social governance Prudential requirements Operational resilience Financial crime and sanctions Consumer protection Complaints, compensation and claims management Regulation of benchmarks and IBOR reform Regulation of capital markets Dispute resolution for financial services lawyers Regulation of derivatives Sustainable finance and ESG Investment funds and asset management Consumer credit, mortgage and home finance Regulation of insurance FSMA regulated pensions activity Payment services and systems Fintech and cryptoassets Regulation of AI in FS Lex Talk®Financial Services: a Lexis®Nexis community Financial Services Enforcement Database Daily and weekly news alerts Intraday news alerts New and updated content Dates for your diary UK, EU and international regulators and bodies The City is...

APPG on investment fraud and fairer financial services Bob Blackman, who chairs the All- Party Parliamentary Group, stated that the FCA has failed to seriously engage with the cross-party panel’s report issued in November 2024. That paper judged the FCA not fit for purpose, urging government intervention and a far-reaching overhaul to tackle its ‘significant shortcomings’ so it can function as an effective regulator. After an almost three-year inquiry, it pressed for rapid internal and external, government-led reforms at the FCA, having uncovered a litany of failings at the watchdog. Testimony from more than 170 whistleblowers and fraud victims, alongside serving and former FCA staff, depicted an organisation that ‘lacks integrity’ and does not act effectively on evidence, the document states. MPs also said the FCA squanders money, makes poor use of its powers, and that an ‘unsettling degree of consensus’ indicates a...

The prolongation aims to allow time to roll out the European Market Infrastructure Regulation ( EMIR 3). EMIR 3 includes steps intended to enhance the appeal and competitiveness of the EU’s clearing markets. That should curb the EU’s excessive dependence on systemically important UK CCPs, thereby lowering medium-term risks to EU financial stability. The European Commission has taken a decision to advance its implementation further......

Here, Law360 looks at why justices upheld Khan's designation and other takeaways from the Court of Appeal's 24 January 2025 judgment. The Office of Financial Sanctions Implementation ( OFSI) licensing route — designed to allow designated people to cover essentials like water and power — was overwhelmed to the point that, the Court of Appeal heard, Anzhelika Khan spent months waiting for official clearance simply to buy food for herself and her children. Delivering a scathing assessment, the judges observed that Khan could have faced prosecution for the mere act of eating. The court concluded that the government had given scant consideration to how those subject to an OFSI asset freeze were meant to get by without breaking the law. “ It is striking that the judges condemned this regime as profoundly inhumane, effectively forcing a mother to choose between obeying the law and...

In this issue: UK, EU and international regulators and bodies Authorisation, approval and supervision Accountability, culture and social governance Prudential requirements Operational resilience Financial crime and sanctions Consumer protection Investigations, enforcement and discipline Regulation of capital markets Dispute resolution for financial services lawyers Regulation of derivatives Sustainable finance and ESG Banks and mutuals UK Mi FID II Consumer credit, mortgage and home finance Regulation of insurance FSMA regulated pensions activity Payment services and systems Fintech and cryptoassets Bank recovery and resolution Financial Services Enforcement Database Daily and weekly news alerts Intraday news alerts New and updated content Dates for your diary UK, EU and international regulators and bodies Ho C Treasury Committee publishes correspondence with FCA The House of Commons Treasury Committee has released exchanges with the Financial Conduct Authority ( FCA), comprising a letter by Dame Meg Hillier MP to the FCA’s chief executive, Nikhil Rathi, dated 19 December 2024, and the regulator’s reply of 20 January 2025. The correspondence updates matters raised at a hearing, including FCA pension...

Among the latest triggers for reform was the Financial Services and Markets Act 2023 ( FSMA 2023), which scrapped obsolete EU-derived rules and handed watchdogs fresh authority to set requirements that safeguard consumers. The statute also introduced a secondary aim centred on growth and competitiveness. Post- Brexit regulatory change has proved expensive and intricate. As the UK marks five years since Brexit, the Financial Conduct Authority ( FCA) is seeking to explain how it will balance consumer protection with the government’s ambition for financial services to spur economic expansion. Some lawyers caution that mixed messages risk creating uncertainty over supervisory priorities. ‘ Is this really the moment to contemplate a sweeping overhaul of the rulebook?’ asked Sara Cody, counsel in Linklaters LLP’s contentious regulation team. ‘ Firms have only just embedded the Consumer Duty and, before that, were grappling with the vast regulatory fallout from Brexit,’ Cody...

UK financial regulators have come into the government’s firing line. On 29 January 2025, Finance Minister Rachel Reeves lambasted their labyrinthine rules and a shortage of predictability in a keynote address on economic growth. Payments supervision has been picked out by the financial services industry as especially intricate. By certain estimates, compliance swallows almost the entire budget companies ringfence for operational improvements. Fintech is a major expansion prospect for the UK, with payments the strongest strand of fintech investment. Naturally, payments has become a focal point for the government. Reeves, alongside Prime Minister Keir Starmer, wrote to the Payment Systems Regulator ( PSR) in December 2024, outlining their expectations for supporting growth. The PSR’s answer, released on 28 January 2025, is unlikely to appease those who criticise the regulator. While the Financial Conduct Authority ( FCA) was praised by industry for unveiling a bold...

What are the practical implications of this case? Appreciating the reach of this ruling will also aid advisers guiding clients on broker commission structures and their potential effect on the interest charged under a conditional fee agreement, together with the precise disclosures that must be made to consumers about any commission in place. Commission arrangements of the sort agreed between Arnold Clark and Clydesdale in this matter were prohibited by the FCA in 2021. Nonetheless, the court acknowledged that a significant number of car purchases occurred in contexts where those or comparable terms existed or might have applied, or could potentially have been present. The Ombudsman concluded that Arnold Clark recommended to Ms Lewis a Clydesdale finance product (the conditional sale agreement) which formed part of the overall transactional package enabling her to acquire the vehicle, alongside the part exchange of her previous car and a...

Re Wealthtek LLP (in special administration) [2024] EWHC 3050 ( Ch) What are the practical implications of this case? This ruling emphasises the need to: distinguish an appointment as administrators of a trustee tasked with administering trust property from being appointed as administrators of an insolvent company to deal with the company’s own assets, and accurately identifying for the court the applicable regulatory regime The first question had to be assessed against the objectives of special administration set out in the Investment Bank Special Administration ( England and Wales) Rules 2011 ( IBSA) SI 2011/1301, in particular Objective 1: the return of client assets as soon as reasonably practicable. That statutory aim framed how the court approached the Administrators’ mandate. Because the Administrators’ function fell within category (i) above, and all clients were adults, the bank held the assets on bare trust; the right to...

The guide has formed part of the FCA’s Handbook of Rules and Guidance since 2011, and the FCA is keen to keep it a practical source for firms, both now and in future. The aim of the revisions is to help businesses grasp the regulator’s expectations, judge whether their financial crime systems and controls are adequate, and remedy any issues uncovered during that review. As its title implies, the guide offers guidance only, not binding rules. It sets out clear, overarching direction on what a rounded, holistic approach to compliance should look like, followed by chapter-by-chapter detail closely aligned to specific financial crime prevention legislation and regulatory expectations. Key changes Sanctions systems and controls Following Russia’s invasion of Ukraine, the FCA carried out wide-ranging reviews of firms’ sanctions systems and controls, and has revised the relevant chapter to capture those insights. Respondents welcomed...