FCA publishes outcome of enforcement regulatory disclosure review

Following a review, the FCA has made several changes to, and has improved, its disclosure processes in regulatory enforcement cases. In the case of Seiler and others v FCA [2023] UKUT 00133, the Upper Tribunal recommended that the FCA review certain elements of its disclosure process in regulatory enforcement cases. This relates to the disclosure of evidence as part of any regulatory case.

In future, the FCA is required to disclose all documents it relies upon to build regulatory enforcement cases, including any other material which may, in its view, undermine its decision to take action. Under a new, broader approach, the FCA will disclose all material relevant to the facts of the matter, save where it is disproportionate, not in the public interest, or otherwise inappropriate to do so. This will include all material, regardless of whether it has the potential to undermine or support the case.

Disclosure reviews will be aimed at identifying all relevant material and will not be focused on only looking for potentially undermining material. This will reduce the risk of a document mistakenly not being disclosed. Most significantly, the FCA is:

•taking a broader approach to disclosure which will mean its review of documents is not focused only on identifying potentially undermining material;
•enhancing its existing training on disclosure to include additional specialist training for those managing and overseeing disclosure exercises;
•providing additional training for staff and more detailed guidance on quality assurance;
•clarifying the roles and responsibilities of staff and managers involved in disclosure; and
•applying greater emphasis on the importance of disclosure in measuring and rewarding staff performance.

Overall, the aim of the changes is to improve the quality of FCA disclosure by providing greater support for case teams. The FCA will closely monitor the efficacy of the changes it is making and conduct a further review in approximately 12 months’ time to assess whether it should take further steps to improve its processes.