Financial Crime: The FCA’s Strategy for 2025 – 2030

The FCA’s objectives

The FCA has set itself three metrics on which we should judge its performance by 2030. These are:

• improvements in market cleanliness, and abnormal and anomalous trading statistics; 
• slower growth in investment fraud victims and losses; and 
• slower growth in authorized push payment (APP) fraud cases and losses. 

The FCA’s focus on investment and APP fraud continues its commitment in these areas, which were also a focus of its 2022-2025 strategy. 

Collaboration with regulated firms 

The FCA reiterates its statement from its 2022-2025 strategy that regulated firms are a vital line of defence against the criminal misuse of financial services. Their systems prevent the illicit flow of cash, guard consumers at risk, and often provide evidence to law enforcement. The FCA pledges to continue working with and to take a less intensive approach to firms seeking to do the right thing, while acting against those through which criminal funds enter the financial system and those who seek to use their FCA authorisation as a cover for crime.

The FCA recognises the costs to firms of having in place effective financial crime controls and will support those who play their part, for example in drawing on new, developing technology. In a speech given in November 2024, Emily Shepperd, the FCA’s chief operating officer, stressed that the FCA was “open to ideas on how we can tackle financial crime more efficiently and proportionately” including, for example, the use of digital passports or new ways to confirm customer identities.   

The tools at the FCA’s disposal: assertive supervision and potential increase in enforcement action

The FCA’s continued emphasis on the role of regulated firms as a vital line of defence underscores the importance for firms of being able to demonstrate robust financial crime surveillance and risk management arrangements.  It is worth noting that at least one of the four following issues appear in 80% of financial crime final notices issued by the FCA since 2023: 

• failure to have, or to appropriately implement, appropriate policies and procedures;
• inadequate financial crime risk assessments at a customer, business, or firm level;
• failure to conduct adequate customer due diligence or enhanced due diligence; and
• transaction monitoring failings.

These issues are likely to continue to be targeted through enforcement action. While both the number and value of financial crime enforcement outcomes has decreased over the last two years, financial crime issues have been a focus of the FCA’s increasingly assertive and interventionist approach to supervision. With the number of skilled person reviews commissioned into potential financial crime-related issues increasing by 130% between 2022/23 and 2023/24, and the use of other interventionist tools such as the agreement of voluntary requirements also increasing significantly, we expect to see an increase in related FCA enforcement outcomes in the near future.   

Empowering consumers

The FCA recognises that despite the best efforts of regulators and firms, it is not possible to prevent all financial crime. This difficulty is reflected by the fact that, as noted above, the FCA aims to slow the growth in investment and APP fraud, rather than prevent instances of them altogether.  

The FCA says it will continue to empower consumers with the knowledge and tools they need to protect themselves. By increasing awareness of investment and APP fraud (such as through its ScamSmart campaigns and scam warnings), and developing new ways to disseminate information about potential scams, the FCA aims to arm consumers with the necessary information to avoid falling victim to financial crime.

Partnerships with other agencies

Financial crime is a global issue that transcends regulatory remits and national borders. Recognising this, the FCA places a strong emphasis on collaboration with domestic and international law enforcement agencies and regulators. By sharing intelligence and coordinating actions, the FCA aims to disrupt criminal networks and prevent the illicit flow of funds across borders.

However, it acknowledges that global cooperation brings greater difficulty in an era of heightened geopolitical instability. Therefore, it may make progress on some issues with a smaller group of likeminded jurisdictions in a similar fashion to the International Anti-Corruption Prosecutorial Taskforce founded this month between the UK’s Serious Fraud Office, the Office of the Attorney General of Switzerland and France’s Parquet National Financier.

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