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The FCA’s Response to MPs’ Report: A Masterclass in Defensiveness

Writer's picture: Steve ConleySteve Conley


The Financial Conduct Authority (FCA), that ever-reliable bastion of financial oversight, has once again graced us with a response to scrutiny that is as predictable as it is underwhelming. In a move that surprises absolutely no one, the regulator has managed to be “disappointingly dismissive” of the All-Party Parliamentary Group (APPG) on Investment Fraud and Fairer Financial Services’ damning assessment of its competence—or lack thereof.


For those fortunate enough to have missed this bureaucratic back-and-forth, a quick recap: the APPG’s original report called out the FCA as “opaque and unaccountable,” painting a less-than-glowing picture of an organisation that seems to take its regulatory responsibilities as mere suggestions rather than obligations. MPs had apparently hoped for something resembling introspection from the FCA. Instead, they received a response dripping with defensiveness, statistical gymnastics, and a steadfast refusal to acknowledge any meaningful shortcomings.


Selective Statistics and Convenient Amnesia

Bob Blackman, co-chair of the APPG, put it rather diplomatically when he stated that the FCA’s reaction to the report was “completely defensive.” The rest of us might simply call it what it is: a bureaucratic shrug dressed up in corporate jargon.


Take, for instance, the FCA’s curious assertion that “85 per cent of its stakeholders” believe the regulator is successfully protecting consumers. Sounds impressive, doesn’t it? One can almost hear the self-congratulatory back-patting echoing through their Canary Wharf offices. But Blackman—displaying the kind of critical thinking one wishes the FCA itself would apply—dug a little deeper. The reality? The FCA’s own 2023 Financial Lives survey reveals that a mere 27 per cent of respondents actually trust the regulator to protect their interests. So where did this 85 per cent figure come from? Presumably, the same place as the idea that the FCA is doing a good job—thin air.


The Art of Dodging Accountability

Of course, the FCA’s reluctance to engage meaningfully with criticism is nothing new. The APPG highlighted that the regulator was unwilling to engage with concerned parties and, rather than taking a moment for self-reflection, it opted for the usual strategy: dismiss, deflect, and deny.


But why should that bother them? After all, as their spokesperson so helpfully reminded us, “Parliament and government have numerous mechanisms to hold us to account.” That sounds reassuring until one remembers that these mechanisms—including parliamentary committees—seem to be engaged in a game of regulatory whack-a-mole, where the FCA consistently dodges scrutiny with well-rehearsed platitudes.


A Regulator in Name Only

The APPG has now taken it upon itself to collect further evidence on the FCA’s failings, presumably in the hope that sheer volume might force a rethink. It is also calling for a meaningful debate in Parliament on whether the regulator needs a complete overhaul. A bold suggestion, but one that will likely be met with more of the same from the FCA—vague promises of improvement, a few empty meetings, and ultimately, business as usual.


At the heart of all this is a rather simple truth: the UK’s financial services sector needs a conduct regulator that actually regulates. One that serves both the City and the citizens, rather than merely maintaining the illusion of oversight. Instead, we have an FCA that appears far more interested in protecting itself than in protecting consumers.


The FCA claims it welcomes debate. Here’s an idea: instead of merely welcoming it, how about actually engaging in it? Until that happens, the regulator will remain exactly as the APPG has described it—opaque, unaccountable, and, above all, deeply disappointing.

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