The FCA said that there is an issue with firms or individuals seeking to avoid liabilities by liquidating and transferring their assets to a new or different firm where they will continue to trade.
The regulator stated: “The challenge here is that evidence of misselling and resultant liabilities to consumers can take a long time to emerge and is often not available when firms or individuals seek authorisation in new or different firms.”
The FCA also revealed that some respondents said that case officers need to improve their knowledge of the financial services market and develop a better understanding of business models.
The regulator said: “We agree that we have a role to play in helping firms prepare for regulatory change. It is a priority that we have been working on, and we will continue to do so. For example, in our consultation, we show that one way we can help firms prepare for authorisation is by giving them enough notice of how they are likely to be affected by forthcoming regulatory changes.
“We use a mix of conventional and innovative approaches, including written communication, press articles, webinars, and speaking at conferences to ensure that firms and individuals understand what we expect of them.
“A combination of consumer demand and technical innovation is driving new and often complex financial services, which are reflected in a broad range of emerging and evolving business models.
“This makes it challenging to ensure that case officers have the necessary market knowledge and can understand a range of very different and frequently complex business models.”