Welcome to the UKGI weekly regulation update service for Aviva ABC brokers

Context

Every six months the FCA publishes data on the Appointed Representative (AR) population and its financial services activity.  The AR population has grown significantly from its inception in 1986 to around 33,000 active ARs in 2026.  The FCA collects data on Principal firms and ARs through Principals completing ‘Add, Change and Terminate AR’ forms and REP025 data submissions. It also makes use of other data that is provided by firms in returns such as the RMAR.

Key points to note and next actions

• The FCA uses the data to focus its resources on the highest risk Principals and their ARs. By analysing trends in the size of the regime, firm activity and revenue, the FCA identifies where sectors are growing or changing and where risks may be emerging.
• At the end of March 2026, there were 2,431 Principals and 33,347 ARs, comprising 20,728 Full ARs and 12,619 Introducer ARs (IARs).
• This represents a reduction of 137 Principals (5.3%) and 224 ARs (0.7%) compared with March 2025.
• Since 2011, the population of ARs operating in general insurance and protection has been gradually decreasing.  This sector saw the largest decrease, losing 346 ARs over the year (down 4.8%).
• In 2025 (covering 1 Jan to 31 Dec), ARs generated around £13.1bn in regulated financial services revenue. This was £0.9bn higher than in 2024 (up 7.3%).  Revenue rose even as the numbers of ARs fell.  This suggests a greater concentration of regulated activity among a smaller number of AR-Principal relationships.
• The largest contributor to regulated revenue in 2025 remained general insurance and protection (£4.03bn, compared to £3.83bn in 2024).
• ARs also generated around £24.5bn in non‐regulated financial services revenue in 2025. Of this, £9.3bn from general insurance and protection (the highest sector figure).

Context

The FCA has published its latest Quarterly Consultation Paper no. 52, CP26/17.  Once a quarter, the FCA consults on proposed miscellaneous amendments to its Handbook. These tend to be minor changes, but the FCA still wants to get your feedback on its proposals.

Key points to note and next actions

• There are items in relation to climate disclosure rules for asset managers, life insurers and FCA-regulated pension providers (proposed changes to the product-level disclosure requirements in ESG), revoking provisions of the UK Capital Requirements Regulation (UK CRR), three provisions in relation to cryptoasset firms, and simplify the scheduling rule for Section M of the Retail Mediation Activities Return (RMA-M).
• Of interest to our clients will be some minor proposed amendments to the guidance on how to complete the FIN073 Baseline Financial Resilience return.  The FCA notes that firms’ reporting periods are not the same and may be different from a calendar quarter or UK fiscal quarter. Qualifying firms see FIN073 return frequency updating as they complete their reporting period.
• The FCA proposes to update SUP 16 Annex 53R and SUP 16 Annex 54G (guidance notes on the data items for FIN073) to cater for firms that meet the criteria to submit FIN073 annually (firms that meet both of the following criteria):
  • they submit Section A of the Retail Mediation Activities Return (RMA-A); and
  • they have annual revenue from regulated activities in scope of the Retail Mediation Activities Return (RMAR) of £150m or less.

Context

The FCA has published the details of a Decision Notice in which it sets out its reasons for imposing a financial penalty of £99,600 on Mr Carlos Ricardo Fuenmayor (“Mr Fuenmayor”), pursuant to section 66 of the Act.  Mr Fuenmayor has referred his Decision Notice to the Upper Tribunal where he and the FCA will present their cases. Any findings in the Decision Notice are therefore provisional and reflect the FCA’s belief as to what occurred and how it considers his behaviour should be characterised.

Key points to note and next actions

• The FCA has decided to fine Mr Fuenmayor, the Chief Executive of BancTrust, for failing to disclose 3 separate matters to the FCA.
• Mr Fuenmayor failed, until December 2021, to tell the FCA, including in application forms that he submitted on behalf of BancTrust, that he had been placed under investigation by the US Financial Industry Regulatory Authority in December 2017 and was then sanctioned by them in June 2019.
• He also failed to disclose that, shortly before an inspection in November 2019, the National Financial Intelligence Unit of Venezuela had frozen his local currency bank accounts, as well as those of his Venezuelan companies and their directors.
• The failure to disclose these issues meant that the FCA did not have the opportunity to fully consider Mr Fuenmayor’s fitness and propriety or seek further information.
• The FCA concluded that Mr Fuenmayor’s failures were negligent and that he breached APER Statement of Principle 4 and Senior Manager Conduct Rule 4, which requires individuals to disclose appropriately any information which the FCA would reasonably expect.

Context

The FCA has published an article by Alex Smith, Head of Cross-cutting Policy and Strategy at the FCA, explaining how the FCA is responding to the practical questions that AI technology raises for firms as it changes financial services.  Firms are using AI to drive efficiency, support decision-making and deliver better outcomes for consumers and markets. The FCA wants to support that innovation, but it must be safe, responsible and well governed.

Key points to note and next actions

The FCA wants to help industry to tackle new and practical questions that AI is raising, so it is speaking to firms on topics such as:

• How firms oversee and govern AI.
• How they test models and monitor outcomes.
• How they ensure fair treatment for customers, including those with features of vulnerability.
• How they explain AI-driven decisions.

The article discusses collaboration with industry, learning together through the AI Lab, and building a shared understanding.  The FCA intends to share good and poor practice later this year to better support firms in adopting AI safely and responsibly and as AI technology develops.

Context

Further its response to the Government on safe AI-powered innovation on 29 May, the ICO has now published a statement on the Government’s new advisory AI Growth Lab.  The Government has announced it is launching the advisory AI Growth Lab which will bring together regulators to give AI innovators and adopters clear, practical information on how existing regulations apply to novel AI applications.

Key points to note and next actions

• The first area of focus will be LawTech, legal services and conveyancing services.
• will be collaborating with the Council for Licensed Conveyancers (CLC), Solicitors Regulation Authority (SRA) and Legal Services Board (LSB) to work with innovators on cross-regulatory challenges.
• The ICO states that supporting responsible AI innovation is a priority and a duty for the ICO, and that it recognises the critical role that initiatives like the Advisory AI Growth Lab play in driving public trust in technology adoption.

Context

Artificial intelligence is transforming how ads are created, styled and delivered – but when it comes to compliance, there’s no shortcut, no cheat code, and no “auto‑fix” button. Whether you’re experimenting with generative imagery, deploying automated ad platforms, or tempted to plug a celebrity likeness into your next campaign, the CAP Code still applies.

Key points to note and next actions

The article sets out useful guidance advertisers and marketing teams need to know before they compile, render or deploy AI‑generated content.  The guidance is set out under four headings:

• The CAP Code is media‑neutral – no exceptions, no escape keys
• Deepfakes don’t get a free pass on being misleading or using endorsements
• AI bias isn’t just a tech problem – it’s a compliance problem
• Automated campaigns don’t remove responsibility

Context

The Committee of Advertising Practice (CAP) and the Broadcast Committee of Advertising Practice (BCAP) recently engaged stakeholders to understand developments in advertising accessibility and the challenges faced by disabled audiences. One of the key themes that emerged from those discussions was the importance of considering accessibility at the start of the creative process, rather than attempting to retrofit accessibility provisions once an ad has been created.

Key points to note and next actions

• Accessibility provisions help a wider range of people understand advertising content. They can make ads more accessible to people with hearing or visual impairments and may include audio description, closed captions and signing (each of which are briefly described in the article).
• Material information is information that the average consumer needs to make an informed transactional decision about a product, service or offer.
• The article provides useful hypothetical examples of how to consider this principle is to look at how it might apply in practice.
• One of the strongest themes that emerged from the stakeholder engagement discussions was the importance of ‘accessibility by design’.
• Some stakeholders expressed the view that accessibility in advertising should be mandated

Context

The Insolvency Service has published details of two Director bans in relation to Leanne Richardson (who was the director of ESL Consultancy Services Ltd, which generated almost 38,000 spam text complaints) and Lex Greensill (who was a director of three companies within the Greensill Group, which collapsed in 2021 with combined liabilities of more than £1.6 bn).

Key points to note and next actions

• ESL Consultancy Services Ltd was fined £200,000 by the ICO but went into liquidation without paying.  The firm promoted high-interest rate loans through the messages, which its affiliate was able to send to 546,000 phone numbers every single day.
• Richardson, of Horsham in West Sussex, has been banned as a company director for six years until 2032.
• In late 2020, Greensill caused the three companies concerned to enter into a series of transactions with US construction company Katerra that removed legal protections from a Credit Suisse fund’s investment.
• The Australian businessman also caused or allowed $440 million received in November 2020 to be used for purposes other than repaying the fund.
• Greensill’s conduct breached his legal duty under the Companies Act 2006 to exercise reasonable care, skill and diligence as a company director.
• A six-week trial was due to begin on Monday 8 June, but Lex Greensill signed a disqualification undertaking – a legally-binding agreement where directors do not dispute certain facts (for the purposes of the disqualification proceedings only) to end court action.
• The disqualification undertaking was accepted by the Secretary of State for Business and Trade on Tuesday 2 June and his ban comes into effect on Tuesday 23 June.  It will last for nine years.

Context

Companies Huse has announced that it is to introduce changes to accounts filing for certain Companies from April 2028.  Small companies and micro-entities will be able to file profit and loss accounts but can opt out of publication. All companies will need to file accounts via commercial software, with more time to prepare.

Key points to note and next actions

The government has announced how accounts reforms measures set out in the Economic Crime and Corporate Transparency Act 2023 (ECCT Act 2023) will be implemented.

Under the ECCT Act 2023, the government will reform how companies report information and what information they report when filing their annual accounts with Companies House. The accounts reforms seek to:

• improve the transparency, accuracy and reliability of data on the companies register;
• inform business decisions;
• modernise practices in line with other countries; and
• tackle economic crime.

After some consideration, the government will proceed with the accounts reforms, including the following:

• Requiring small companies and micro entities to file profit and loss accounts with Companies House as other companies do, but with the option to opt out of publishing this information on the public register.
• Requiring all companies to file their annual accounts via commercial software.
• Removing the option for companies to file abridged accounts.
• A strengthened eligibility statement for all companies claiming an audit exemption.
• Requiring component parts of the filed accounts and reports to all be filed together.
• Reducing the number of times a company can shorten its accounting reference period.

To give companies more time to prepare, this package of accounts reforms will now come into effect from April 2028, rather than April 2027. This means all companies will have one full accounting year, plus 9 months (21 months) to get ready.

Companies House will be contacting all companies via their registered e-mail address to tell them about these changes and signpost available guidance.

Context

The CII has published an article suggesting that public reporting about non-financial misconduct (NFM) may help address NFM in the insurance sector.  The CII points out that regulation alone will not change culture. In a new report, the professional body identifies greater public reporting on complaints, processes and outcomes as a potential lever to strengthen accountability and accelerate cultural change.

Key points to note and next actions

• As well as public reporting, the report identifies areas for further consideration to include commercial pressures, where fear of reputational damage prevents action against misconduct; and the establishment of internal capability for firms to exercise consistent judgement on misconduct.
• It was also agreed that small firms are likely to require targeted support to address the structural challenges of small firm environments.
• The next phase of the CII’s research will move beyond understanding why misconduct persists, to testing which interventions are effective. Priorities include piloting interventions within firms, developing baseline measurement frameworks, creating anonymised case study resources, and providing psychological safety support for those who report misconduct.

Context

The IUA has published an article urging market protocols for cyber-related business interruption claims, stating that a new published report demonstrates that the market would benefit from clear protocols governing the review process.

Key points to note and next actions

• Such claims are often complex in situations where a tower structure has been established, with multiple insurers providing layers of coverage for large risks.
• An established framework, covering questions such as the appointment of experts, fee sharing, and information flows could bring greater consistency and efficiency to the process.
• The IUA’s new paper outlines how the layered structure of cyber towers currently poses a number of challenges for reviewing claims. So called ‘split market reviews’ can be fragmented with duplicated effort and other wasteful procedures.
• Compared to traditional insurance sectors, like property, the cyber insurance sector is still relatively young and established protocols are still emerging. Many claim handlers are building their business interruption experience as the market grows.
• To build on the findings of the new report, the IUA will, in the coming months, be convening market practitioners to consider potential solutions and practical next steps for the cyber insurance market.