FCA publishes the final version of its updated Enforcement Guide

On 3 June 2025, the Financial Conduct Authority (FCA) published PS25/5: Our Enforcement Guide and greater transparency of our enforcement investigations, the final version of its streamlined and updated Enforcement Guide (now referred to as ENFG) which came into force on the same day.

This concludes (for now at least) a very public debate between the FCA and relevant stakeholders in relation to transparency and efficiency in enforcement.

We have been covering these developments since the FCA published the first consultation paper (CP24/2: Our Enforcement Guide and publicising enforcement investigations - a new approach). We summarise the final changes to the ENFG as set out in PS25/5 and provide our insights and conclusions.

PS25/5 in outline

Transparency in enforcement – questions answered?

In March 2025, the FCA announced that it would drop the controversial public interest framework proposal for 'naming and shaming' firms under investigation. While we – and others across the industry – welcomed the u-turn, we noted that there remained a number of outstanding questions (see our blog post here). The policy statement goes some way towards answering those questions.

Broadly, the updated investigations publicity policy in Chapter 4 of the ENFG is as follows: the existing exceptional circumstances test (ENFG 4.1.4 to 4.1.5) remains the principal test for determining whether to announce an investigation about a regulated firm. PS25/5 does not make any substantive changes to the publicity policy in this regard, so it may be fair to expect that there will be no change in what 'exceptional circumstances' means going forward or how the FCA applies that test (at least in the near to mid-term).

However, there are now three additional circumstances in which the FCA may announce its investigations:

• Firstly, the FCA may announce investigations concerning suspected unauthorised activity or criminal offences in relation to an unregulated activity if it considers such an announcement to be desirable for the purpose of alerting customers or investors, or to assist with the investigation, e.g. by bringing forward witnesses (ENFG 4.1.6). When making a decision to announce an investigation under this ground, the FCA will consider the potential prejudice that the announcement may cause to the subject of the investigation.
• Secondly, the FCA may reactively confirm whom it is investigating where the investigation has been made public by the investigation subject or an affiliated company (e.g. parent) or a regulatory, government or public body (ENFG 4.1.7).  This is envisaged to take the form of a confirmatory statement on the FCA's website, by the FCA's press office, or in response to a parliamentary request for information. As to the content of such a confirmation, the FCA has stated that the information will not 'typically' go beyond what has already been placed in the public domain (i.e. confirmation of the name of the subject of the investigation and may include the subject matter of the investigation).
• Thirdly, the FCA may make anonymised announcements where it is desirable for the purposes of education or to encourage compliance with the FCA's rules or requirements (ENFG 4.1.8). PS25/5 states that the FCA is considering ways of sharing information on a general (thematic) basis, but notes that the FCA may also make anonymised announcements about a particular investigation. PS25/5 confirms that before making an announcement, the FCA will consider the risk that an announcement, even if anonymised, may disproportionately negatively affect firms of the relevant type or in the relevant sector. Further, the FCA will take all reasonable steps to ensure that the investigation subject(s) cannot be identified.

The FCA confirmed the position on some overarching points:

• Confidentiality – all announcements are subject to applicable statutory restrictions, including the restriction on disclosing information that regulated firms give to the FCA during an investigation.
• When a decision is made – the publicity policy will be considered when an investigation is opened and, where the FCA does not publicise information at the start of an investigation, it will consider whether to do so at 'regular review points'.
• Form – the form in which the FCA publicises information may vary (as discussed above), and the FCA is considering whether it might show announcements on the FCA Register, Warning List and the Firm Checker facility.
• Reporting – the FCA will report annually on the number of cases where it shares information about an investigation but subsequently takes no further action. This is intended to increase scrutiny of enforcement activity with a view to holding the FCA accountable to its 'new' approach to enforcement focused on efficiency.

Future consultation

CP24/2 contained a broader set of proposed changes to the ENFG than the widely debated transparency proposals. Whilst they did not attract the degree of attention given to the transparency proposals, they were (and are) significant changes primarily aimed at streamlining and 'focusing' the ENFG. Below, we cover the extent to which these proposals were adopted in PS25/5.   

Notably, the FCA has dropped its proposal to change when it consults on future changes to the ENFG. Originally, it had proposed to consult only where statutorily required or where it believed it was necessary to do so. The FCA is not required to consult on changes to the ENFG under the Financial Services and Markets Act 2000 (FSMA 2000), but it has historically consulted on all the ENFG changes and has confirmed it will continue to do so.

In line with our response to CP24/2, the FCA seems to have recognised that consultation is consistent with the broader transparency objective of promoting efficiency in enforcement. By engaging with the relevant stakeholders, the FCA can identify areas where greater clarity is needed to inform more targeted reform.

Whilst the FCA notes that it is not statutorily required to consult on changes to the ENFG, failure to do so may be a breach of the overarching duty on public bodies to act fairly which arises in circumstances where there is a well-established practice of consultation (among others). Interested stakeholders may consider bringing a judicial review challenge on this ground if the FCA were to go back on its decision to continue consulting on proposed changes to the ENFG in the future.

Relocation, removal (and retention) of content

PS25/5 has implemented a suite of revisions to the ENFG aimed at improving accessibility through more focused content.

• Website guidance – the FCA has removed material (parts of Chapters 2 and 3) from the ENFG and moved it to its website. The material relates to its high-level strategic approach to enforcement, changes to which it does not generally consult on.
• Deletion of duplicative wording – the revised ENFG strips out content that merely restated statutory powers or duplicated material already found in the Decision Procedure and Penalties manual. The FCA confirmed that this does not signal a change in policy or practice – its powers remain the same, and it will continue to use them in the same way.
• Moving content to the Supervision manual – the FCA has relocated guidance on supervisory powers (e.g. powers to cancel a permission) to the Supervision manual in line with its objective to refocus the ENFG to contain key enforcement-related policy.
• Guidance on other powers – the FCA has retained guidance on the other powers it may use alongside its investigation and enforcement powers (e.g. injunctions, disqualification, etc.) as well as its non-FSMA powers under other legislation, albeit as Appendices 1 and 2 to the ENFG respectively. In relation to the former, the guidance on these powers has been abridged.

Following the publication of the CP24/2, we identified deletions in the ENFG which were not specifically signposted in CP24/2 (see our blog post here). The FCA's decision to refrain from making (at least some of) these deletions is welcome, as they included the cardinal requirement for a legal review to be conducted by an FCA lawyer outside of the investigation team prior to referral to the Regulatory Decisions Committee (RDC).

Changes to bring the ENFG in line with enforcement practice

PS25/5 also made a number of changes to the ENFG to clarify and reflect the FCA's current approach to enforcement.

• Accepting reports on a limited waiver basis – the basis on which the FCA will accept a firm's own investigation report on a limited waiver of privilege basis has been clarified. The FCA confirmed that this does not signal a change in approach.
• Attendance of legal advisers at compelled interviews – the ENFG now explicitly states that the FCA may refuse the attendance of a particular legal adviser at a compelled interview if their presence could prejudice the investigation, e.g. due to conflicts of interest.
• Scoping meetings – the FCA has moved away from the presumption that scoping meetings will always occur; it will now be able to decide on a case-by-case basis whether to hold scoping discussions. However, in response to concerns raised in the consultation, the FCA confirmed that its approach will still generally be to have a scoping meeting where investigation subjects want or request one. This change is intended to add flexibility where investigation subjects agree that a scoping meeting is unnecessary.
• Private warnings – the FCA has formally retired the use of private warnings and the ENFG no longer refers to them. This is not a shift in approach, but a reflection of the fact that they are no longer used in practice. The FCA considers that the objectives of a private warning can be met by communicating the issues under investigation to the investigation subject, which has been the approach over the past few years.

Our insights and conclusions

We were pleased to see the FCA take a significantly more measured position in its final policy statement following its two-part consultation. The concessions to retain consultation on changes to the ENFG and the legal review requirement are particularly welcome.

It will be interesting and important to monitor how some of the changes to the ENFG play out in practice, e.g. the use of reactive and anonymised announcements, as well as some of the apparent emphasis shifts in ENFG, e.g. in relation to the attendance of legal advisers in interviews. 

In relation to transparency in enforcement, the regulated community should not assume that the publication of PS25/5 marks the end of the debate. The FCA fought hard to realise the proposal – issuing two consultations and undertaking widespread industry and stakeholder engagement is not entirely unprecedented, but it is the exception rather than the rule. There are statements within PS25/5 which indicate that the FCA has not fully bought into the arguments against its proposal. For example, the FCA will be measuring the success of its new policy 'by tracking, so far as reasonably possible, the reasons for whistleblower disclosures and witnesses coming forward, and public and industry confidence in our enforcement work via surveys'. It may follow that, should there not be an increase in whistleblower disclosures, witnesses coming forward and/or confidence in enforcement, the case for more radical transparency should be revisited.

Nonetheless, the FCA’s openness to engage after the first consultation paper was appreciated by stakeholders and it is to be hoped that a degree of open engagement could be maintained as the FCA continues to enhance the enforcement processes to be more transparent, efficient and effective. Over the course of our responses to these consultations and separately, we have sought to provide constructive examples of where the process works well and where there is room for improvement and would like to continue to explore these wider themes.