Executive Summary
2024 represented a transitional year for FCA enforcement, with total fines of approximately £176 million across 27 enforcement actions. While this figure is lower than peak enforcement years, it reflects the FCA's strategic shift towards proactive supervision and early intervention rather than reliance on ex-post penalties.
The year's most significant enforcement action was the £48.65 million fine against TSB Bank for its 2018 IT migration failure. This case, which took over six years to conclude, illustrates the complexity of major enforcement investigations and the FCA's thorough approach to evidence gathering.
Regulatory Context
2024 marked the final year of Consumer Duty implementation, with the extension to closed products and services taking effect in July 2024. The FCA dedicated substantial supervisory resource to assessing firm readiness, with enforcement activity expected to follow in subsequent years for firms failing to meet the new standards.
Operational resilience requirements became increasingly prominent, with the FCA working alongside the PRA to assess firm compliance with the March 2022 policy statement. The TSB fine served as a powerful reminder of the consequences of operational failures affecting customer access to banking services.
The regulatory landscape also saw continued evolution of the cryptoasset framework, with the FCA maintaining its consumer warnings while processing registration applications under the MLR regime.
Key Enforcement Themes
- Operational resilience failures attract significant penalties
- IT system migrations require robust governance and testing
- Consumer Duty implementation assessment ongoing
- Data protection and cyber security remain priorities
- Continued focus on AML systems and controls
Professional Insight
The TSB enforcement action provides crucial lessons for the industry. The £48.65 million fine reflected not only the IT migration failure itself, but fundamental governance weaknesses in project oversight. Boards must ensure they receive adequate management information on major technology programmes and maintain appropriate challenge of executive assurances.
From a regulatory relationship perspective, 2024 demonstrated the value of proactive engagement with supervisors. Firms that self-identified issues and presented credible remediation plans generally received more constructive regulatory engagement than those where problems were identified through supervision or complaints data.
The Consumer Duty implementation work revealed significant variance in firm approaches. Leading firms embedded customer outcomes into product governance from inception, while laggards treated compliance as a documentation exercise.
Looking Ahead
2024 set the stage for more intensive Consumer Duty enforcement in 2025. The FCA accumulated substantial data through implementation reviews and will use this to identify outlier firms for closer scrutiny.
Operational resilience will remain a priority, particularly as firms increasingly rely on third-party technology providers. The FCA's interest in concentration risk in critical third parties will likely drive future supervisory and potentially enforcement action.