The Financial Conduct Authority (FCA) has published the updated version of its Enforcement Guide (now to be known under the new acronym ENFG, in place of the old ENF), which came into force on 3 June 2025. It has implemented the bulk of its proposed changes to streamline its enforcement guidance, although there are some areas where it has decided not to take proposals forward or clarified the drafting which had been proposed in the consultation. Key points include confirmation of the FCA’s approach in connection with:

1. investigation announcements;
2. legal advisers at compelled interviews;
3. sharing of privileged material; and
4. future consultation on the ENFG. 

Investigation announcements 

The FCA has confirmed that it has dropped its original proposal to adopt a public interest test for publishing announcements naming firms when opening an enforcement investigation (see our briefing and blog following the FCA’s previous update in March). 

As trailed in March, the FCA has kept the “exceptional circumstances” test for announcing an investigation that was previously in place but has added three additional instances where announcements could be made, stating that feedback shows broad support for increased transparency in these areas:

1. Unauthorised/ unregulated activity: If the FCA considers an announcement is desirable to warn or alert consumers or investors or to help the investigation itself, for example by bringing forward witnesses, it may announce and name the subject of an FCA investigation into suspected unauthorised activity or a suspected criminal offence in relation to an unregulated activity. This covers suspected criminal offences involving the unregulated part of an authorised firm’s business but not misconduct in its regulated activities. In deciding whether to make an announcement, the FCA will consider the potential prejudice that it believes may be caused to any persons who are, or who are likely to be, a subject of the investigation.
2. Reactive announcements: If the fact of an investigation has already been made public by the firm in question, an affiliated company or a regulatory body, government or public body, the FCA may reactively confirm that it is investigating. The announcement may also confirm the nature of the investigation as far as that has already been made public.
3. Anonymous publication: The FCA may make public that it is investigating a particular matter without naming or otherwise identifying the subject of the investigation, where it is desirable to educate people about the types of conduct the FCA is investigating or to encourage firms to comply with its rules or other requirements. 

The FCA will assess the impact of its revised publicity policy by tracking the reasons for whistleblower disclosures and witnesses coming forward, and public and industry confidence in its enforcement work via surveys. It will do the same to assess any positive change in firm behaviour reflected, for example, by potentially better and faster remedial measures. 

Legal advisers at compelled interviews

As proposed in the consultation, the FCA has clarified its approach to the attendance of legal advisers at a compelled interview. Generally, an interviewee can be accompanied by a legal adviser who acts for them. Rarely, the FCA may refuse attendance of a particular legal adviser where they think their attendance may prejudice the investigation or any other ongoing investigation. This has previously sometimes been the case in practice where, for example, the FCA has had concerns that attendance of legal advisers also representing the interviewee’s firm may impact on the effectiveness of the interview, potentially inhibiting an individual from providing relevant evidence. 

Sharing of privileged material 

The FCA has clarified that it will accept reports over which legal privilege is asserted on a limited waiver basis, but that, in doing so, it is not necessary for the FCA to agree how far privilege attaches to all or parts of a report. The FCA’s view is that the question of whether legal privilege applies is ultimately for the courts and that this does not undermine a firm’s ability to resist disclosure of a report to third parties. 

Future consultation regarding changes to ENFG

Contrary to the proposed position in the consultation, in light of consultation responses, the FCA has decided to maintain its current practice of consulting on all changes to ENFG and will continue to apply its usual consultation processes.

Impact on firms

The FCA acknowledges that the consultation feedback received significantly contributed to its final policy position in relation to its investigation publicity policy and, consequently, many will see the ‘name and shame’ reversal in position as a rare success story for industry push-back. However, we wait to see whether the FCA will in future stretch the provision for investigation announcements to be made in “exceptional circumstances”.  When considering making their own announcements (for example where the fact of an investigation constitutes inside information) firms will also have to take into account that this may trigger a reactive announcement from the FCA over which they have no control.  

Anonymised announcements may assist firms in identifying areas to address in their own businesses. However, the FCA will need to tread carefully when considering making and drafting such announcements to ensure that they do not give away the identity of the subjects (including individuals), leading to unhelpful speculation and/ or have a market destabilising effect.  Firms and senior managers will need to ensure that they identify lessons learned and any actions they need to take in their areas of the business following anonymous announcements, as failing to do so is likely to be treated as an aggravating factor if any similar issues are uncovered in the future.   

The FCA has confirmed that it now has fewer open investigations, with the number having fallen by over 35% since April 2023 and investigations are reaching outcomes more quickly. This is a double-edged sword for firms in that they are less likely to be investigated but more likely to face an outcome if they are (with increased public attention) and firms and individuals may come under significant pressure to make early admissions with a view to keeping up the improved speed of investigations. 

Individual cases of bad behaviour and associated firm-related failings remain on the regulatory agenda for investigation and the FCA’s objective of achieving deterrence through making examples and achieving maximum impact from a smaller number of cases could drive up penalties. There may also be a greater risk of a public supervisory intervention if the FCA seeks to take action - and makes this public - at an earlier stage when concerns are identified. It puts the emphasis for firms firmly on compliance and prevention, so as to avoid being dragged into the spotlight.