Money Covered: The Week That Was – 29 May 2026

Welcome to The Week That Was, a round-up of key events in the financial services sector over the last seven days.

The first of Season 5 of our podcast, Money Covered – The Month That Was, was released this week. David Allinson and Mel Redding discuss the FCA’s proposed section 404 consumer redress scheme for vehicle finance.

To listen to this and all previous episodes, please click here.

Accountants

ICAEW finds AI is reshaping roles not reducing demand

On 22 May 2026, the ICAEW published a research paper into the evolution of mid-tier accountancy firms using AI versus employing graduates. 

The research shows that, although over 68% of the firms asked confirmed that they expect AI to reduce the need for some early-career roles, 83% do not expect fewer roles overall, with work shifting from routine compliance towards judgement, interpretation and ethical oversight.  

Firms anticipate moving up the value chain, with the greater focus expected to be in hiring specialists in areas such as data analytics, technology, sustainability and regulation. 

The real concern for those entering the profession is the predicted 40% fall in graduate recruitment. If the 'routine work' usually carried out by those graduates is absorbed by technology, there is a risk that firms will not adapt to the training, supervision and oversight changes, creating governance and capability bottlenecks. 

To read more, please click here.

Tax Practitioners

Late payment interest brought into force for penalties relating to tax avoidance schemes

On 20 May 2026, the Finance Act 2009, Sections 101 and 102 (Penalties for Non-disclosure and Promotion of Tax Avoidance Schemes) (Appointed Day) Order 2026 (SI 2026/552) was made. 

The Treasury's Order sets 21 May 2026 as the date when sections 101 and 102 of the Finance Act 2009 (which deal with late payment interest and repayment interest) start to apply to certain HMRC penalty regimes, including:

• DOTAS (Disclosure of Tax Avoidance Schemes) penalties under sections 315 and 315A of the Finance Act 2024; and
• Finance Act 2026 penalty provisions relating to:
• prohibition on promoting certain tax avoidance arrangements (section 162);
• promoter action notices (section 171);
• anti-avoidance information notices (sections 194 to 198); and
• a lawyer’s incorrect declaration about privileged material (section 210).

What this means in practice is that from 21 May 2026, late payment interest will accrue on any unpaid penalty amounts due to HMRC, and repayment interest will apply where HMRC has to refund taxpayers.

To access the relevant provision of the order please click here. 

Brokers

House of Lords launches consumer insurance regulation inquiry

On 21 May 2026, the House of Lords announced that it is launching an enquiry into consumer insurance regulation.  The inquiry will be broad, looking at the selling of consumer insurance (both directly and by third parties), claims handling, enforcement of regulations and dispute resolution between consumers and insurers.

Baroness Noakes, head of the House of Lords Financial Services Regulation Committee, said: "We have launched this inquiry to find out if the insurance market is working for the many people who buy home and travel insurance. We want to find out whether the current regulations are effective, whether they are properly enforced, and whether there is anything that the regulators and Government need to do differently. We welcome evidence and views from anyone with expertise or interest in this area." 

Alongside the press release for the inquiry, the House of Lords also put out a public call for evidence.  The deadline for response is Friday 26 June 2026.

To view the public call for evidence, click here.

FCA publishes regulatory guide for credit brokers

The FCA has published a regulatory guide for credit brokers 

In the guide, published on 20 May 2026, the FCA provides guidance for smaller credit broking firms, with a view to helping them understand and implement the FCA's expectations, but in a proportionate way for their business. The guide also seeks to help appointed representatives that carry out broking for authorised firms.

Matters covered by the guide include:

• Section 1 – Core standards of behaviour that always apply to credit broking
• Section 2 – Promoting a credit broking business and finding customers
• Section 3 – How credit broking businesses should deal with customers, before and after entering a contract with them
• Section 4 - Making sure the right people are in the right roles and the application of the Senior Managers & Certification Regime
• Section 5 – The basic day-to-day arrangements needed to run the business safely, manage risks and treat customers fairly.

Other sections include dealing with complaints, updating the FCA and how firms are supervised.

The FCA is piloting how to support smaller firms with navigating the FCA's requirements, and this guide is part of that.

To read more, please click here.

Financial institutions

FCA review finds some financial promotion approvers need to raise standards

The FCA has published findings from a review of authorised firms that approve financial promotions for unauthorised businesses.

The review found that some firms approving financial promotions need to do more to protect consumers. The strongest firms have clearly been applying the Consumer Duty from the start of their approval processes, but other firms continuously fell short.

The key points of the review include:

• Firms approving financial promotions must ensure each promotion is fair, clear and not misleading
• The strongest firms ensured promotions were accurate, clear and reached the right audience
• Some firms approved adverts containing unsubstantiated claims
• Some firms allowed retail investors to see promotions intended for professional clients
• In some cases, firms relied on third-party templates rather than carrying out proper checks themselves
• The FCA sampled promotions approved since the relevant firm had been authorised to approve them
• One firm has already had to carry out a remediation exercise; and
• Some websites have been blocked to retail customers following the FCA’s work

The FCA said consumers see these promotions daily through social media, online adverts, websites and apps, and that failures by approver firms can lead people into harmful financial decisions.

The FCA said it will continue to monitor compliance and will hold firms that fall short to account.
To read more, please click here.

Regulatory developments for FCA regulated entities

FCA questions 40 firms on the model portfolio service market

Citywire has reported that the FCA has sent requests for information to 40 firms, which included wealth managers and asset managers, in early May.

In relation to co-manufacturing agreements as part of the FCA's thematic review of the model portfolio service (MPS) market, the FCA has asked firms the following questions:

1. How many co-manufacturing relationships the firm has for its MPS as at 31 March 2026.
2. For details of the co-manufacturing relationship the firm has for its MPS; and
3. Where the firm is part of any co-manufacturing relationships, for a description of how fees are allocated.

The FCA has also asked questions on AI and portfolio construction.

Demand for MPS products has grown and the FCA appears to be keen on ensuring that consumers are receiving good value and whether there are any inherent conflicts of interest.

Those firms that received requests for information have been given eight weeks to file their responses.

To read more, please click here.

With thanks to this week's contributors:  Heather Buttifant, James Parsons, Brendan Marrinan, Ben Simmonds, Alison Thomas and Kerone Thomas

If you have any queries please do get in contact with a member of the team, or your usual RPC contact.