LCF report lifts lid off FCA failings

The collapse of London Capital & Finance in 2019 after acquiring £236 million from 11,600 customers – many of whom were inexperienced or elderly investors – has exposed serious shortcomings at the regulator. A report by Dame Elizabeth Gloster into the Financial Conduct Authority’s supervision of the firm highlights numerous red flags and warnings that went unheeded, dysfunctional silos, miscommunication to the public, along with a culture that disavows responsibility where authorised firms conduct unregulated business. Adam Samuel dissects the disaster.

Adam SamuelBA LLM DipPFS MCISI FCIArb Certs CII (MP&ER) Barrister and Attorney may be contacted atadamsamuel@aol.com.For links to where you can buy the second edition of ‘Consumer Financial Services Complaints and Compensation’, see www.adamsamuel.com/book.

At the start of 2021, the FCA received two well-deserved thumpings: from the Elizabeth Gloster report into its mishandling of the LCF scandal and Raj Parker’s review of its and the Financial Services Authority’s mishandling of the Connaught mess. The Gloster report is easily the more important. It relates to more recent times and is consequently more damning.