Regulations
By James Thorp
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Due Diligence Gets Critical. Regulated firms can't just trust what these Annex 1 outfits tell them.
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March 2026 Warning Shot. On March 21, 2026, the FCA cranked up the pressure again.
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Consumer Protection Concerns. The focus extends to scenarios where individuals form limited companies to access unregulated…
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The FCA just dropped guidance. Regulated companies need to run thorough checks when they work with unregulated lenders, custody providers, and financial leasing firms that…
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Around 1,200 firms sit in a weird regulatory limbo - they're registered with the FCA but only for anti-money laundering purposes.
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Regulated firms can't just trust what these Annex 1 outfits tell them. They've got to verify registration status themselves, check the information independently, and assess risks…
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Sarah Pritchard, who runs Markets at the FCA, said regulated firms bear the responsibility for managing risks when they deal with these limited-oversight companies.
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The regulator followed up with 300 firms in late 2025 to check their compliance. Not exactly a gentle nudge.
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But consumers are getting caught in this mess too. The FCA spotted cases where people get advised to set up limited companies just to access loans from unregulated bridging…
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On March 21, 2026, the FCA cranked up the pressure again. The regulator told firms they need to align with legislative requirements and keep robust anti-money laundering controls…
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The authority's been having ongoing chats with industry players to hammer home compliance standards.
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Pritchard stressed that transparency and accountability matter in financial dealings, even when one party operates under limited regulatory oversight.
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The FCA keeps evaluating how these firms operate and what impact they're having on the broader financial landscape.
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Officials are pretty vocal about the need for transparency in transactions involving Annex 1 firms.
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As oversight continues, the FCA stays engaged in discussions with regulated firms to strengthen compliance frameworks.
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