The FCA recognises that complying with this higher standard will require a "significant shift" in culture and behaviour for "many firms". In this light, the Consumer Duty has been described as being a "paradigm shift" by the FCA.
Cementing the 'outcomes based' strategy set by the FCA in its 2022 Business Plan, the Consumer Duty is comprised of three key elements:
1. A new Principle for Business: the 'Consumer Principle' which requires firms to "act to deliver good outcomes for retail customers"
2. "Cross-cutting rules" setting out three overarching behavioural expectations that apply across all areas of firm conduct
3. "Four Outcomes", which are a suite of rules and guidance setting more detailed expectations for firms
The FCA regards the Consumer Duty as key to the better functioning of the financial services sector in future and has warned that the Senior Managers & Certification Regime will be increasingly used to ensure compliance.
The Duty imposes a pro-active requirement, and firms will need to be 'ahead of the curve' if they are to avoid supervisory, or even enforcement action from the FCA. We are uniquely well placed with our combination of lawyers and regulatory consultants to help with any or all of your Consumer Duty needs.
Whether you want ad hoc support in respect of specific issues, an independent third party review of plans and progress, or for us to work closely with your internal teams to manage and implement the Consumer Duty, DWF's team is able to help.
If you would like to discuss Consumer Duty and the impact it may have on your firm, please contact: Robbie Constance Head of Financial Services Regulatory, Andrew Jacobs Head of Regulatory Consulting or Richard Humphreys, Head of Consumer Credit, Regulatory,
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