FCA restricts 6 firms following concerns over anti-money laundering controls

The firms agreed to the restrictions, which prevent onboarding new customers, undertaking new business with existing customers, or extending credit. For compliance leaders, the message is clear: Annex 1 status does not mean light-touch supervision. The FCA is intensifying scrutiny of firms relying on MLR registration in higher-risk lending models, and application reviews are being used as supervisory gateways.

Affected firms should expect operational and liquidity impacts and must engage with the FCA on remediation. Wider Annex 1 lenders should treat this as a pre-application readiness warning: test AML governance, customer due diligence, enhanced due diligence, ongoing monitoring, risk assessments, SAR reporting and record-keeping against MLR requirements before the regulator does. Banks, payment firms and fintechs that partner with or fund Annex 1 lenders should refresh third-party financial crime due diligence and monitor restrictions.

Actionable steps include board-level review of AML frameworks, documented remediation plans, clear customer and counterparty communications, ensuring no restricted activity occurs, and seeking specialist advice where needed. Firms with strong controls may gain competitive advantage as partners prioritise compliant counterparties.