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FCA publishes new web page about who needs to complete the FIN074 return

Mar 21, 2024 | FCA

Link(s):FIN074 returns – who needs to complete and why | FCA

Context

The FCA published a web page providing some guidance about which firms need to complete the FIN074 Financial Crime Levy return, and why. The FIN074 is a RegData Report introduced in April 2023 and designed to help the FCA, on behalf of HM Treasury, identify which firms are liable to pay the new Economic Crime Levy.

Key points to note and next actions

  • ICO publishes new guidance on how it decides to issue penalties and calculate fines.
  • The FCA publishes new web pages about who needs to complete the FIN074 return.  This return asks for a firm’s revenue in a given financial year.  If your firm has received a FIN074 return, The FCA has assessed that it is subject to the MLRs. This likely means that your firm is considered by the FCA to be either a ‘credit institution’ or a ‘financial institution’, as defined for the purposes of the MLRs.  This will very likely be driven by the Permissions a firm has. 
  • Not all firms who receive FIN074 will be required to pay the Economic Crime Levy. Only firms that report over the minimum revenue threshold will be liable to pay the Levy.  If you believe, though, that your firm is exempt from paying the levy, you should contact the FCA.
  • The web page explains where to identify what a ‘credit institution’ or a ‘financial institution’ is, and one potential exclusion from being deemed a lender under ‘financial institution’.  Explanations are provided for consumer credit firms involved in lending and consumer hire.
  • In relation to insurance distributors, their insurance activities are not in scope of the MLRs when carried out for contracts for general insurance (but would be in scope for contracts for long-term insurance, e.g., life policies).
  • There can be circumstances where insurance firms have additional permissions to provide regulated activities that may bring them within scope of the MLRs, e.g., lending unless the potentially relevant exemption in regulation 10 (3) (b) of the MLRs applies.
  • If the FCA agrees that an insurance firm is exempt, it will remove the FIN074 return from its RegData profile.