Fee Changes, Data Quality, and Insider Dealing Cases

Unknown Speaker

Hello everyone, welcome back to the B-Compliant podcast! I’m Vicky, joined by the fabulous Rachel as always. Rachel, it feels like we were just dissecting those deposit protection updates, and here we are with another consultation to get stuck into—CP25/33. You ready?

Rachel MacRae

Oh, absolutely! Is it bad I actually quite enjoy when we have a few consultations to look at, gets me thinking about how we can help clients interpret new rules or regulatory change? Anyway, CP25/33—this is the one about the FCA’s proposed fee and levy changes for 2026/27, isn’t it? There’s a fair bit in here, but let’s start with the stuff that’ll hit most retail investment and wealth firms. The big headline is extending fee-block A.13 so it covers firms offering targeted support. So, if you’re planning any of those new targeted support activities, you’ll get the joy of paying the standard A.13 fee—at the moment that’s £550—and you need to make sure you’re capturing that income on your eligible income return.

Unknown Speaker

Yeah, exactly, and not only does that mean a fee, it also brings firms into the right FOS industry blocks and the FSCS levies, so it’s not just one new line item—there’s a wider impact on how you’re assessed across the system. I do like that the FCA is actually asking for feedback on whether income is the right tariff base here. Not everyone agrees income tells the full story for targeted support, but it’s up to firms to get those views in by, what, January?

Rachel MacRae

Spot on—9th January 2026 for targeted support proposals and 16th for everything else. I guess, to me, it's the fact that they're not just dumping hefty new fee blocks—there are some proposals around cryptoasset application fees too. These only apply if you’re trying to get through the new cryptoasset perimeter, but, wow, those fees run from like, what is it, nearly three grand up to 28,000 depending on the activity? That’s more than a cheeky admin charge, for sure.

Unknown Speaker

Tell me about it! And there’s that joint FCA and PRA move to put payment-on-account due dates on the last working day of March and August. I can’t tell you how many times we see firms flagged as late just because of how direct debits hit at the month’s end, so this should clear up some silly admin problems. I mean, who knew compliance could be so... calendar-based?

Rachel MacRae

Right! And they’re also pulling back that idea of expanding the “relevant business” definition in FEES 5. Which—thank goodness, because splitting out consumer and non-consumer activity for reporting would’ve been a total nightmare for so many of the smaller firms we support. They’ve realised it just isn’t proportionate to the risk involved.

Unknown Speaker

And, thinking ahead, there’s future talk of a quarterly pro rata of fees for firms who cancel permissions from April 2027, and consulting on rebating those huge motor finance skilled person review costs. There’s a lot to unpack here, but honestly, it’s all about making the fee system a bit fairer and a lot less prone to weird errors—or at least that’s the hope!

Rachel MacRae

And staying on the theme of error correction, let's talk about the FCA’s latest data quality review. Seems like we’ve been banging this drum for ages—if you listened to episode 7, you’ll remember all that chat about data protection fines and controls, and—well, this is the prudential side now. The FCA’s had a close look at how MIFIDPRU investment firms are reporting, and it isn’t exactly a glowing report card...

Unknown Speaker

No, not at all. I mean, 60% of firms passed all the data checks, so... glass half full, but that leaves 40% still getting things wrong. The biggest problems are in Own Funds reporting and those pesky K-factor fields, which—I'll admit—even I find confusing sometimes. Mix-ups in categorisation under MIFIDPRU 1.2 were everywhere, and a chunk of firms were misreporting Own Funds Threshold Requirements, not matching up with the rules in MIFIDPRU 9.

Rachel MacRae

And it keeps coming back to basics: making sure the ICARA matches up with what’s in the MIF007 return— seems like people aren't using copy and paste! But we’re seeing blank or dodgy K-factor fields, especially for firms that should be reporting as non-SNI, and—maybe this is just me— people don’t seem to be reading the guidance on this stuff before they fill it out.

Unknown Speaker

That’s so true, Rachel, and the FCA’s not just grumbling quietly about it any more—they’re starting to issue data quality notifications and talking about making RegData even stricter with automatic validations. I always tell firms: benchmark yourself! Take the findings in this report and compare them to your own process. Otherwise, you end up with incorrect capital requirements or, worse, explaining yourself to the regulator when you really don’t want to be on that call.

Rachel MacRae

But it’s not all doom and gloom. There’s progress, and a lot of the problems are avoidable if you strengthen your internal checks. Firms can absolutely get this right—it just takes some process updates and paying attention to those recurring errors.

Unknown Speaker

Speaking of paying attention, can we take a second to talk about those post-budget dates? I know, everyone’s sick of hearing about it—us included. But, as much as I might joke about “Rachel Reeves’ damage”, this is one of those moments where advisers really need to nail the timing for client conversations. The shape of the changes is clear now, so let’s rattle off what everyone needs in their diary.

Rachel MacRae

Absolutely. The big one is 6 April 2026—for most of our listeners, this is when dividend tax rates jump by 2 percentage points, the state pension gets its usual triple lock upgrade, and tax relief on VCTs goes down, so it’s all happening at once! And, further out—if you somehow haven’t had enough—6 April 2027, we get savings income tax rate increases and, awkwardly, new property income tax rules too - this is also when the Autumn 2024 budget changes to pensions and IHT come into force too, so it is looking like 2027 will be a bit busy!

Unknown Speaker

And then there’s April 2028 with more freezing of thresholds and a new high-value property surcharge, and let’s not forget—2029 brings the cap on NI relief for salary sacrifice pension contributions down to just £2,000 per year. It’s a lot, but the point here is to help clients plan ahead.

Rachel MacRae

Exactly. If you want to get ahead of those conversations, now is the time. Don’t wait until clients call you in a panic—use these dates to shape your advice well in advance.

Unknown Speaker

And while we’re talking about planning and good habits, the FCA’s just brought another insider dealing case. It’s against Bobosher Sharipov and Bekzod Avazov, tied to the GCP Student Living takeover. It’s got all the trimmings—insider info, suspicious timing, nearly £70,000 in profits, and that very modern twist of tech-enabled surveillance picking them up.

Rachel MacRae

Oh, that one! Yeah—the details are wild. It was Mr. Sharipov who apparently leaked info to Mr. Avazov, who then did a quick round of trading and spread betting. It was the FCA’s monitoring tools that spotted how perfectly timed and profitable it all was—not your average luck on the markets! Shows how seriously the FCA is taking the market abuse side of financial crime these days. If you haven’t got robust insider lists, information barriers, and proper staff training, this is a wake-up call..

Unknown Speaker

Exactly, Rachel. This case fits with the FCA's five-year financial crime strategy, and it just underlines how important it is for compliance teams to not only have processes, but to actually test and embed them. It’s about a real culture of compliance—not just paperwork.

Rachel MacRae

Couldn’t agree more! And on the topic of culture and keeping up, for those interested in the tech side—or who caught Vicky’s session at the PFS Conference—our AI governance documents are now in the online library. There’s a draft AI policy, due diligence checklists, even sample wording for client agreements. If you’re even thinking about using AI or if you have already started to dip your toe into the AI water, it’s a good time to get your governance sorted and, well, compliant. Just shout if you want advice or fancy a proper review—we’re always here.

Unknown Speaker

That’s probably a good place to leave it for today. Loads happening, as ever, but we’ll be back digging into all the next round of updates soon enough. Thanks for listening, Rachel—always a pleasure as ever!

Rachel MacRae

Always a giggle, Vicky. Thanks everyone for joining us—keep your questions coming and we’ll see you in the next episode!