View more on these topics

FCA to toughen crowdfunding rules

FCA logo new 2 620x430

The FCA plans to toughen its rules for crowdfunding firms, including extending mortgage-lending standards to loan-based platforms.

The regulator today issued an update on its review of the loan-based and investment-based crowdfunding market.

The regulator has proposed several new rules for the market, which it will consult on in early 2017.

The new rules include more prescriptive requirements on the content and timing of disclosures by both loan-based and investment-based crowdfunding platforms.

For loan-based platforms only, the FCA plans to consult on strengthening rules around wind-down plans, imposing additional restrictions on cross-platform investment and extending mortgage-lending standards to loan-based platforms.

In its update, the FCA says it has found it is difficult for investors in both loan-based and investment-based crowdfunding platforms to compare crowdfunding with other asset classes because of complex and often unclear product offerings.

It also says it is difficult for investors to assess the risks and returns of investing on a platform and that the way some firms are structured leads to conflicts of interest that are not being managed properly.

FCA chief executive Andrew Bailey says: “Our focus is ensuring that investor protections are appropriate for the risks in the crowdfunding sector while continuing to promote effective competition in the interests of consumers.

“Based on our findings to date, we believe it is necessary to strengthen investor protection in a number of areas. We plan to consult next year on new rules to address the issues we have identified.”

The FCA expects its research and investigatory work to be finished early in 2017.

Recommended

FCA logo new 3 620x430

FCA consults on moving mortgage LTI ratios to rolling quarter limit

The Financial Conduct Authority has set out proposed amendments to guidance on loan to income (LTI) ratios in mortgage lending with a view to moving to a four-quarter rolling limit. In 2014, the Financial Policy Committee made a recommendation on LTI ratios in mortgage lending asking regulators to ensure that mortgage lenders limit the number of […]

FCA logo new 3 620x430
1

FCA eyes unused permissions in mediation announcement

The Financial Conduct Authority says it will contact firms that do not use their regulatory permissions and is prepared to cancel them. The FCA reinforced its position on unused regulatory permissions in a document today, justifying the information it requests in its retail mediation activities returns. The regulator says some of the information it requests […]

Rob-Clifford-MM-Peach-700.png

FCA unlikely to loosen the shackles: Clifford

Imla may hope for a more optimistic approach from the FCA for those locked out of the market but it faces disappointment Several interesting white papers published in the past few weeks were designed to assess the market and to propose changes in order to develop a more rounded, fit-for-purpose process. The Conveyancing Association’s paper […]

Health - thumbnail

Absence management systems gone AWOL from UK’s SMEs, reports Jelf

A quarter (23 per cent)* of the UK’s small to medium-sized enterprises (SMEs) do not have an absence management system in place, according to new research from Jelf Employee Benefits. Despite 69 per cent* of organisations having a system in place, three-quarters (75 per cent) report that it is not providing them with sufficiently empowering absence or health data to inform an effective wellbeing programme.

Parental leave and pensions

Fiona Hanrahan  – Senior Product Insight and Technical Support Analyst We are often asked how parental leave impacts workplace pension schemes in terms of funding in general, auto enrolment and salary exchange. This article will explain each of these. How does parental leave impact the funding of workplace pension schemes? A member of a defined […]