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Poor practice in financial promotions: This week in regulation

29/08/19

The speed read

  • CMCs must raise the standards of financial promotions
  • Current account services information published

CMCs must raise the standards of financial promotions

The FCA has issued a press release outlining the common failings it has seen in claims management companies’ (CMCs) financial promotions since it took over regulation of the sector on 1st April 2019.

Examples of poor practice include:

  • Failing to identify themselves as CMCs
  • Failing to inform consumers that they could make a claim to a statutory ombudsman or compensation scheme free of charge
  • Suggesting consumers may get a more favourable outcome if they used the services of a CMC
  • Use of the phrase ‘no win no fee’ without an explanation of the fee involved
  • Placing important information in the small print or in a position that makes it difficult to read.

Firms are once again reminded of the financial promotions rules, which the regulator recently outlined in a Dear CEO letter issued on 4th June. It is also continuing to monitor the financial promotions CMCs produce and has warned that if firms produce particularly poor financial promotions they are unlikely to meet the Threshold Conditions for authorisation.

 

Current account services information published

Following action by the FCA and Competition and Markets Authority (CMA), current account providers are improving the quality of information they publish about their personal and business current account services. This is designed to help customers and other stakeholders effectively compare accounts and seek assistance if things go wrong.

The latest data, covering August 2019, has now been published and includes information on:

  • Account opening speeds
  • Speed of debit card replacements
  • Number of major operational and security incidents
  • Service quality.

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