The UK financial sector operates under a strict regulatory framework to ensure transparency, consumer protection, and market stability. Financial services firms must comply with Financial Conduct Authority (FCA) and Prudential Regulation Authority (PRA) rules to avoid legal risks and maintain trust.

In this guide, Cifa.ac explores the essentials of UK financial services compliance, including key regulations, compliance challenges, and best practices for financial firms.

1. What is Financial Services Compliance?

Financial services compliance refers to adhering to legal and regulatory requirements set by UK regulators. It ensures:
✅ Protection of consumers from fraud and unfair practices.
✅ Prevention of financial crime (money laundering, insider trading, etc.).
✅ Fair competition in financial markets.
✅ Stability and resilience of the UK financial system.

2. Key UK Financial Regulators

1. Financial Conduct Authority (FCA)

• Regulates banks, investment firms, insurance companies, and financial advisors.
• Ensures fair treatment of consumers and market integrity.
• Enforces the Consumer Duty Regulation (2023) for better client protection.

2. Prudential Regulation Authority (PRA)

• Oversees banks, insurers, and major investment firms.
• Ensures financial institutions remain stable and solvent.

3. Financial Ombudsman Service (FOS)

• Handles consumer complaints against financial firms.

4. Financial Services Compensation Scheme (FSCS)

• Protects customers if a financial firm fails (e.g., deposit protection up to £85,000).