The British regulator — the Financial Conduct Authority, or the FCA — has just released its yearly enforcement action report. The report includes all the actions that the regulator was forced to take across the financial services industry during the 2018-2019 fiscal year.
Issued on Wednesday, July 10th, the report is quite a lengthy document, indicating that the regulator has been busy throughout the year. However, a few sections of the report do stand out, showing some interesting development.
One such section details all the necessary steps that the FCA had taken in order to deal with unauthorized firms that are trying to sell their products to retail traders. The report also indicates that the regulator received around 16,600 reports of various unauthorized activities in the past fiscal year alone.
While this includes the entirety of the UK, it is still a massive amount of reports and a 25% increase when compared to the year before. Not only that, but this is also the largest number of complaints that the FCA had ever received in only twelve months.
The number of complaints is higher than ever
At first glance, this is an extremely bad state of things, where the unauthorized activity is conducted at every step. If there are 16,600 reported incidents, who can tell how many there were that managed to stay under the regulator’s radar? However, this situation can also be seen as quite a positive one, from the right perspective.
For example, the increased number of complaints and reports means that more and more people know how to recognize a scam. Of course, it could also indicate that there is a growing number of scammers within the UK’s territory and that some of them are getting caught.
The FCA also pointed out that binary options brokers have been making moves in hopes of attracting UK residents. They are not the only companies trying to do so, but they do appear to be in the majority. The regulator commented on this by admitting that it started looking into a large group of binary options brokers. The group includes more than 200 unauthorized brokers which the watchdog managed to identify in 2018 alone.
While many of the unauthorized binary options brokers that the regulator had identified were based outside of the country, there were quite a few that had connections to the UK-based entities. The FCA then focused on these entities, launching up to nine separate investigations. At this point, three of them are still ongoing.
The regulator was, apparently not at liberty to disclose much in regards to these investigations. However, it did admit that a key figure was arrested during one of the investigations. The regulator also stated that it is a ‘large, multi-jurisdictional,’ which many have taken as a hint at the ongoing trial of Lee Elbaz, a binary options scammer from the US.