FCA confirms new rules to improve AR responsibilities

The FCA has outlined new rules that aim to make authorised financial firms more responsible for their appointed representatives (ARs).

The rules will help prevent consumers being misled mis-sold by ARs, and will prevent misconduct by ARs undermining markets operating fairly and safely.

ARs, which are not authorised by the FCA, can offer financial services or products under the responsibility of authorised firms, known as principals. Principal firms are responsible for ensuring their ARs comply with our rules and while some principals do this effectively, the FCA warns that many do not adequately oversee the activities of their ARs.

Under the new rules, principal firms will need to apply “enhanced oversight” of their ARs, including ensuring they have adequate systems, controls and resources, and provide complaints and revenue information for each AR to the FCA on an annual basis.

The FCA is also expecting firms to assess and monitor the risk that their ARs pose to consumers and markets, review information on their ARs’ business activities, notify the regulator of future AR appointments 30 days before they take effect.

FCA executive director for consumers and competition, Sheldon Mills, commented: “While ARs can bring innovation and choice, principals and ARs account for more than 60% of the total value of recent claims to the Financial Services Compensation Scheme. They also generate up to 400% more supervisory cases and complaints than other directly authorised firms.

“The changes we’re making will help ensure that principals manage their ARs better – ensuring that they provide the oversight needed to avoid consumers being mis-sold or mis-led and to make sure markets can operate safely and fairly. They will also need to provide us better data and information to support our own work.”

The FCA confirmed it is also working with the Treasury to explore if further changes are needed to the AR system, which would require future legislative change.

    Share Story:

Recent Stories


FREE E-NEWS SIGN UP

Subscribe to our newsletter to receive breaking news and other industry announcements by email.

  Please tick here to confirm you are happy to receive third party promotions from carefully selected partners.


NEW BUILD IN FOCUS - NEW EPISODE OF THE MORTGAGE INSIDER PODCAST, OUT NOW
Figures from the National House-Building Council saw Q1 2025 register a 36% increase in new homes built across the UK compared with the same period last year, representing a striking development for the first-time buyer market. But with the higher cost of building, ongoing planning challenges and new and changing regulations, how sustainable is this growth? And what does it mean for brokers?

The role of the bridging market and technology usage in the industry
Content editor, Dan McGrath, sat down with chief operating officer at Black & White Bridging, Damien Druce, and head of development finance at Empire Global Finance, Pete Williams, to explore the role of the bridging sector, the role of AI across the industry and how the property market has fared in the Labour Government’s first year in office.


Does the North-South divide still exist in the UK housing market?
What do the most expensive parts of the country reveal about shifting demand? And why is the Manchester housing market now outperforming many southern counterparts?



In this episode of the Barclays Mortgage Insider Podcast, host Phil Spencer is joined by Lucian Cook, Head of Research at Savills, and Ross Jones, founder of Home Financial and Evolve Commercial Finance, to explore how regional trends are redefining the UK housing, mortgage and buy-to-let markets.

The new episode of The Mortgage Insider podcast, out now
Regional housing markets now matter more than ever. While London and the Southeast still tend to dominate the headlines from a house price and affordability perspective, much of the growth in rental yields and buyer demand is coming from other parts of the UK.

In this episode of the Barclays Mortgage Insider Podcast, host Phil Spencer is joined by Lucian Cook, Head of Research at Savills, and Ross Jones, founder of Home Financial and Evolve Commercial Finance.