Financial Services Act 2012
What this means for your business
- Applies to
- United Kingdom
- On this page
- 5 compliance obligations, 4 practical guides across 2 topics
What you must do
5 compliance obligations under this legislation — 5 can result in imprisonment.
Offences and prohibitions 5
Carry on regulated activity without permission
2 years imprisonmentIf your firm carries out a regulated activity in the United Kingdom – including any credit‑related activity – without the appropriate permission from the FCA or the PRA, you commit a criminal offence. On conviction you face an unlimited fine and up to two years’ imprisonment. The case can be tried either in the Magistrates’ Court (summary) or the Crown Court (indictable).
Create false or misleading impression about investment price
10 years imprisonmentIf you deliberately give a false or misleading impression about the market price, value or demand for an investment, with the aim of persuading someone to buy, sell, subscribe, underwrite or refrain from dealing, you commit an offence. The offence also covers situations where you know the impression is false or are reckless about it and you intend it to cause gain or loss. A conviction can lead to criminal sanctions such as unlimited fines and possible imprisonment, although the exact penalties are set in other sections of the Act.
Make false or misleading statements that affect benchmark setting
10 years imprisonmentIf you give another person a false or misleading statement, or create a false impression, that is intended to be used in setting a financial benchmark (for example LIBOR or EURIBOR), and you know it is false or reckless, you commit a criminal offence. The offence applies only when the statement or impression is made in the UK or to someone in the UK. Conviction can lead to a fine and/or imprisonment, the exact limits being set in the Act’s penalty provisions.
Make false or misleading statements to induce financial agreements
2 years imprisonmentIf you, or someone acting for your business, knowingly or recklessly make a false or misleading statement, or hide material facts, with the aim of persuading someone to enter (or avoid) a financial agreement or to exercise investment rights, you commit an offence. Conviction can lead to an unlimited fine and up to two years’ imprisonment. Defences are limited to specific price‑stabilising or market‑abuse exemptions.
Obstruct a regulator's inquiry
2 years imprisonmentIf you refuse to follow a request from an FCA or PRA inquiry, or deliberately hinder that inquiry, the regulator can refer the matter to the High Court. The court can then treat you as if you were in contempt of court, which can bring unlimited fines and up to two years' imprisonment.
Penalties for non-compliance
5 penalties under this legislation. 5 can result in imprisonment. 5 carry an unlimited fine.
Carry on regulated activity without permission
Unlimited fine and/or 2 years imprisonment
Create false or misleading impression about investment price
Unlimited fine and/or 10 years imprisonment
Make false or misleading statements that affect benchmark setting
Unlimited fine and/or 10 years imprisonment
Make false or misleading statements to induce financial agreements
Unlimited fine and/or 2 years imprisonment
Obstruct a regulator's inquiry
Unlimited fine and/or 2 years imprisonment
Practical guidance
Our guides explain how to comply with the requirements above.
Get FCA authorisation for financial services
How to apply for Financial Conduct Authority authorisation to carry on regulated financial activities. Covers the application process, fees, capital …
Banking regulation and PRA authorisation
Dual PRA and FCA authorisation requirements for UK banks, including capital requirements, mobilisation routes, and ongoing regulatory obligations under SM&CR …
Financial services regulation and FCA authorisation
Regulatory requirements for financial services businesses.
Understanding UK consumer credit regulation
What consumer credit regulation is, why it exists, and who it applies to. Covers the relationship between the Consumer Credit …
Sections and provisions
126 classified provisions from this legislation.
Duties 17
- s.57B Duty of Bank to inform Treasury about resolution plans Bank
- s.59 Duty of Bank to notify Treasury of changes
- s.62 Directions under section 61: supplementary provisions time by notice
- s.63 Duty to lay direction etc before Parliament
- s.64 Duty of Treasury, Bank and PRA to co-ordinate discharge of functions
- s.65 Memorandum of understanding: resolution planning and crisis management
- s.66 Memorandum of understanding: international organisations
- s.71 Conclusion of inquiry
- s.77 Power of Treasury to require regulator to undertake investigation
- s.78 Conduct of investigation
- s.79 Conclusion of investigation
- s.80 Statements of policy
- s.82 Publication of reports of inquiries and investigations conditions of confidentiality subject
- s.84 Arrangements for the investigation of complaints
- s.86 Consultation in relation to, and publication of, complaints scheme
- s.99 Reports following exercise of a stabilisation power requirements as
- s.110 Payment to Treasury of penalties received by Bank of England
Offences and penalties 6
Powers 19
- s.27 Powers of regulators in relation to parent undertakings
- s.31 Additional power to direct UK clearing houses
- s.33 Power to take disciplinary measures against recognised bodies
- s.37 Discipline and enforcement
- s.38 The Financial Services Compensation Scheme
- s.50 Mutual societies: power to transfer functions
- s.51 Further provision that may be included in orders under section 50
- s.52 Power to apply or disapply provision made by or under FSMA 2000
- s.61 Treasury power of direction
- s.68 Cases in which Treasury may arrange independent inquiries
- s.69 Power to appoint person to hold an inquiry
- s.70 Powers of appointed person and procedure
- s.87 Investigation of complaints
- s.107 Power to make further provision about regulation of consumer credit
- s.109 Payment to Treasury of penalties received by Financial Services Authority
- s.113 Provision of services by Director of Savings
- s.118 Power to make further consequential amendments etc
- s.119 Transitional provisions and savings
- s.122 Commencement
Definitions 12
- Schedule 3 Financial Conduct Authority and Prudential Regulation Authority: Schedules to be substituted as Schedules 1ZA and 1ZB to FSMA 2000 the Bank appointed member
- s.19 Primary information providers Primary information provider Specified The limitation period
- s.24 Rules and guidance Rules Specified Charges
- s.48 Interpretation of FSMA 2000 the FCA the PRA rule
- s.57 Interpretation of Part 3 regulator
- s.58 Duty of Bank to notify Treasury of possible need for public funds
- s.67 Interpretation of Part 4 Group resolution plan Resolution plan
- s.75 Interpretation of section 74
- s.83 Interpretation and supplementary provision listed securities regulator consumer
- s.85 Relevant functions in relation to complaints scheme
- s.93 Interpretation of Part 7 Relevant agreement Relevant benchmark Relevant investment
- s.117 Interpretation FSMA 2000 the FCA the PRA
Exemptions 8
- Schedule 16 Provision of financial services by members of the professions
- s.43 Provisions about consumer protection and competition
- s.57A Duty of Bank to provide information required by Treasury
- s.73 Duty of FCA to investigate and report on possible regulatory failure
- s.74 Duty of PRA to investigate and report on possible regulatory failure
- s.76A Duty of Payment Systems Regulator to investigate and report on possible regulatory failure
- s.81 Publication of directions
- s.88 Exemption from liability in damages