Money and Banking: Banking Laws

Financial Services and Markets Act 2000 (FSMA)

Date Enacted: 14 June 2000

Individuals and Organizations Regulated: The Financial Conduct Authority (FCA), the Prudential Regulation Authority (PRA), the Bank of England, and all firms that provide financial services in the UK.

Activities Regulated: The FSMA regulates various financial services activities, including banking, insurance, investment, and mortgage services.

Purpose of the Law: The FSMA aims to ensure that the UK financial system is stable, transparent, and fair, and that consumers are protected. The law created the FCA and PRA to oversee financial firms, requiring firms to meet certain standards and disclosures to protect consumers.

Payment Services Regulations 2017 (PSR)

Date Enacted: 13 January 2018

Individuals and Organizations Regulated: All payment service providers operating in the UK, including banks, e-money institutions, and payment institutions.

Activities Regulated: The PSR regulates payment services, including transferring funds, direct debits, and card payments.

Purpose of the Law: The PSR aims to ensure that payment services are safe, efficient, and transparent and that consumers are protected. The law sets out requirements for payment service providers, including security measures, customer disclosures, and dispute resolution procedures.

Financial Services Act 2012 (FSA)

Date Enacted: 19 December 2012

Individuals and Organizations Regulated: The FCA, the PRA, and all firms that provide financial services in the UK.

Activities Regulated: The FSA amended the FSMA to strengthen financial regulation in the UK, focusing on improving the financial system's stability.

Purpose of the Law: The FSA aimed to improve the regulation of financial services in the UK and to prevent a repeat of the 2008 financial crisis. The law introduced a number of new measures, including stricter capital and liquidity requirements for banks, new powers for regulators, and a new regulatory framework for consumer credit.

Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (MLR)

Date Enacted: 26 June 2017

Individuals and Organizations Regulated: All UK financial institutions, including banks, insurers, and investment firms, as well as certain other businesses, such as estate agents, that are at risk of being used for money laundering or terrorist financing.

Activities Regulated: The MLR sets out requirements for financial institutions to prevent money laundering and terrorist financing, including customer due diligence, record keeping, and reporting suspicious activity.

Purpose of the Law: The MLR aims to prevent the UK financial system from being used for illegal activities, such as money laundering and terrorist financing. The law sets out requirements for financial institutions to detect and report suspicious activity, and it imposes penalties for non-compliance.

Consumer Credit Act 1974 (CCA)

Date Enacted: 31 October 1974

Individuals and Organizations Regulated: All firms that provide credit or hire agreements to consumers in the UK.

Activities Regulated: The CCA regulates consumer credit agreements, including loans, credit cards, and hire purchase agreements.

Purpose of the Law: The CCA aims to protect consumers who borrow money or enter into hire agreements, by requiring lenders to disclose key information about the credit terms and providing consumer rights, such as the right to cancel certain agreements. The law also sets out requirements for lenders to obtain a license and comply with certain standards, and it provides for enforcement and penalties for non-compliance.

Financial Services (Banking Reform) Act 2013 (FSBRA)

Date Enacted: 18 December 2013

Individuals and Organizations Regulated: All UK banks and building societies.

Activities Regulated: The FSBRA regulates banking activities, with a particular focus on improving the safety and soundness of banks and reducing the risk of another financial crisis.

Purpose of the Law: The FSBRA aims to strengthen the regulation and supervision of banks in the UK, with a particular focus on improving their safety and soundness. The law introduces a number of new measures, including new requirements for capital and leverage ratios, ring-fencing of retail banking activities, and new powers for regulators to intervene in failing banks.

Markets in Financial Instruments Directive II (MiFID II)

Date Enacted: 3 January 2018

Individuals and Organizations Regulated: All firms that provide investment services in the UK.

Activities Regulated: MiFID II regulates investment services, including the buying and selling of financial instruments, and it requires firms to meet certain standards and disclosures.

Purpose of the Law: MiFID II aims to improve the functioning of financial markets in the EU by increasing transparency and investor protection. The law sets out requirements for firms to disclose costs and charges, to provide best execution of client orders, and to report transaction data to regulators. It also introduces new rules for trading venues and market intermediaries.

Payment Services Regulations 2017 (PSR 2017)

Date Enacted: 13 January 2018

Individuals and Organizations Regulated: All payment service providers operating in the UK.

Activities Regulated: The PSR 2017 regulates payment services, including credit transfers, direct debits, payment card transactions, and electronic money services.

Purpose of the Law: The PSR 2017 aims to promote competition and innovation in the payment services market, while also enhancing consumer protection. The law sets out requirements for payment service providers to obtain a license, to meet certain standards for security and reliability, and to provide consumers with clear and accurate information about their services.

Financial Conduct Authority Handbook (FCA Handbook)

Date Enacted: Ongoing updates since 2013

Individuals and Organizations Regulated: All firms and individuals that are regulated by the Financial Conduct Authority (FCA).

Activities Regulated: The FCA Handbook covers a wide range of activities in the financial services industry, including banking, investment services, insurance, and consumer credit.

Purpose of the Law: The FCA Handbook sets out the rules and guidance that firms and individuals must follow in order to comply with FCA regulations. It covers topics such as conduct of business, prudential standards, consumer protection, and market conduct. The Handbook is regularly updated to reflect changes in regulations and market conditions.

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